Risk, the ugly sister or: how you can try a new approach to the subject and have success in projects ? Workshop at the International Friedberger PM-Forum at 10th of march 2006 run by Dr. Klaus Wagenhals, Development of organizations and leaders, Offenbach

Understanding Risk Management Risk management focuses on the early recognition and management of dangers that could jeopardise the project’s execution or success Special risks can include: a complex contract, international environment or team Risks can be assessed differently due to differences in socio-political or economic systems, climate, or religious belief

Riskmanagement depends on personality, culture (of the company) and the role in the project behaviour norms/values assumptions the dimensions for Distinguishing national Cultures (Hofstede a.o.) culture personality (Enneagramm) Role in the project Role-taking Role-playing Role-performing

Risikoverhalten nach Persönlichkeitstypen Typ 1(Perfektionist) ärgert sich wenn der Projektablauf durch unvorhergesehene Dinge verzögert wird; hat Aversion gegen Risiken – wird alles tun, um sie zu vermeiden Typ 2 (Geber) erkennt und vermeidet Risiken, die Beziehungen gefährden könnten Typ 3 (der Erfolgreiche) nimmt sich wenig Zeit für Details – will „action“; nimmt Risiken in Kauf, wenn ihm keine Nachteile entstehen Typ 4 (Künstler) steht gerne am Abgrund, braucht den Nervenkitzel – blüht auf , wenn sich Risiken auftun; sieht diese als Herausforderung an Typ 5 (Beobachter) versucht Risiken sachlich und nüchtern zu betrachten , zieht alle Einflußfaktoren in betracht, verläßt sich auf seine Logik Typ 6 (TeamPlayer) kann sich alles vorstellen, was überhaupt schief gehen kann und bremst daher die anderen Typ 7 (Optimist) sieht die Situation optimistisch und neigt dazu Risiken zu übersehen oder zu unterschätzen Typ 8 (Boss) neigt dazu keine Furcht zu empfinden, verläßt sich auf seinen Instinkt, hat keine Geduld für detaillierte Analysen Typ 9 (Vermittler) blendet Gefahren unbewußt aus und „übersieht“ damit Risiken

Schein’s Levels Of Culture Visible (hard to decipher) Visible organisational structures and processes Language, Rituals, Dress, Behaviors, etc. Norms and espoused values partly visible, partly subconscious (espoused justifications) Strategies, goals, philosophies, taboos invisible, mostly subconscious (ultimate source of values and actions) Basic underlying assumptions Unconscious, taken-for-granted beliefs, perceptions, thoughts and feelings Adapted from E.H. Schein The Corporate Culture Survival Guide (1999)

Hofstede´s Dimensions Power Distance measures emotional distance between manager and staff. People from low PD cultures expect to be involved in decision making, defining project targets and organisation, planning. He is treated as being equal. People from high PD cultures expect the leader to decide, define the project targets and organisation, team guidelines, project planning. In return leaders receive special privileges. Individualistic/collectivistic describes from where people derive their identity. In individualistic cultures identity is anchored in the person. They tend to take care of their own interests and In collectivistic cultures identity is derived fro membership in a particular “in-group”, e.g. family, clan or company. They exhibit a high degree of loyalty to the group and decisions must always take the group’s interests into account. Uncertainty Avoidance (UA) measures the degree to which people feel threatened by uncertain or unknown situations Cultures with a high UA seek to avoid uncertainty through the use of (unspoken) rules and structures. Cultures with a low UA tend to dislike a lot of formal rules. They respond to new challenges with curiosity and value creative and innovative solutions.

Main cultural influences on risk management Risk management finds great acceptance among people with these cultural characteristics Risk management finds little acceptance among people with these cultural characteristics Low Power Distance staff expect to be involved in decision-making High Power Distance Staff expect to receive instructions Individual Stating one’s opinion is a sign of an upright person Low-context communication Everyone is expected to state their opinion Collective One should maintain harmony and avoid a direct dispute High-context communication Opinions are predetermined by membership of a group Feminine Managers rely on their intuition and seek consensus Conflicts are resolved through negotiation and the search for a compromise Masculine Managers are expected to enjoy making decisions and be decisive Conflicts are resolved through being dealt with

Where The Role Comes From Organisation Tasks Understanding of the main tasks Culture Values & Norms Structure Training, Position, Power Position Expectations Status Role sender (The Others) Environment cook Father Personality (Role receiver, Role bearer) Habits, Values, Wishes, Abilities Friend/ lover Behaviour Quelle: Steiger & Lippmann Handbuch angewandte Psychologie für Führungskräfte Berlin (1999)

Risk Statement Statements are interpreted differently, due to different cultural filters A good risk statement must Be clear Be easy to understand Contain a condition and a consequence Since some formulations can cause offence, they should be checked by the risk manager before “release” Risk assessment should be carried out by the project team to protect against cultural distortion Depending on power distance, the assessment can be carried out individually or in groups before being aggregated

Risiko Statement Bedingung Konsequenz Kriterien für ein gutes Risikostatement: Es muss eindeutig sein Es muss leicht verständlich sein Es muss Bedingung und Konsequenz sowie Wahrscheinlichkeit enthalten Nr. Risiko Bedingung Konsequenz Wahrscheinlk 1 Nicht ausreichend Ressourcen während der Entwicklungsphase verfügbar Das Projekt wird sich um mindestens 60% 4 Wochen verzögern 2 …

Risk-evaluation and activities evaluation out of the statement (and classification) by projectmanager and/or -team make a list with priorities and communicate it (attention: be careful with your sentences!) Planning activities and fixing an appropriate process for controlling (states of escalation included and a plan for urgent situations; important: exact definition of indicators for the overcome of the fixed values)