Managing Risk and Opportunities in Complex Projects

Abstract

Projects is the preferred model for one-of-a-kind production. Projects may be difficult to manage due to complexity and many involved stakeholders. Stakeholders are a major source of uncertainty. Uncertainty may be both positive and create opportunities and negative giving risks. Risks and opportunities are either operational, strategic or contextual. The traditional approach to managing risk comprise identification and analysis of risks as well as response planning and control. There is a need for a shift in mindset for managing risks. Rather than regarding risks as “evil”, they should be managed because uncertainties also create opportunities. The Bermuda Risk Triangle is the intersection between operational, strategic and contextual risks. Project risk navigation is about how project leaders can navigate in this triangle to reach their objectives. Opportunities are often more or less neglected in projects. At the most, just a few are identified. A framework for managing opportunities is suggested. It builds on the project control variables: time, cost and scope of work. It contains a classification of eight opportunity types. Using this classification in dedicated workshops has shown to produce far more opportunities than usual. The framework is verified in a case study. The case is the construction of the new National Museum in Oslo, Norway. Through the framework a total of 246 opportunities have been identified representing an estimated cost reduction of about 64.2 million USD.