Enterprise Intelligence Quarter

Risk Analysis Quarter (hereinafter, the Quarter) is the second of four lectures of Team Quadrivium (hereinafter, the Quadrivium):

• The Quarter is designed to introduce its learners to enterprise discovery, or, in other words, to concepts related to obtaining data needed to administer the enterprise effort; and
• The Quadrivium examines concepts of administering various types of enterprises known as enterprise administration as a whole.

The Quadrivium is the first of seven modules of Septem Artes Administrativi, which is a course designed to introduce its learners to general concepts in business administration, management, and organizational behavior.

Outline

The predecessor lecture is Market Engagements Quarter.

Concepts

1. Risk analysis. Controlling residual risks, identifying new risks, executing risk response plans, and evaluating their effectiveness throughout an enterprise effort.
   • Risk event. A discrete occurrence that may affect the project for better or worse.
   • Trigger. Triggers, sometimes called risk symptoms or warning signs, are indications that a risk has occurred or is about to occur. Triggers may be discovered in the risk identification process and watched in the risk monitoring and control process.
   • Risk category. A source of potential risk reflecting technical, project management, organizational, or external sources.
2. Risk. An uncertain event or condition that, if it occurs, has a positive or negative effect on an enterprise effort.
   • Secondary risk. A risk that arises as a direct result of implementing a risk response.
   • Residual risk. A risk that remains after risk responses have been implemented.
   • Identified risk.
3. Conflict. (1) Perceived incompatible differences that result in interference or opposition; (2) A process that begins when one party perceives that another party has negatively affected, or is about to negatively affect, something that the first party cares about.
   • Traditional view of conflict. The view that all conflict is bad and must be avoided.
   • Human relations view of conflict. The view that conflict is a natural and inevitable outcome in any group.
   • Interactionist view of conflict. The view that some conflict is necessary for a group to perform effectively.
4. Conflict process. A process that has five stages: (1) conflict potential, potential opposition or incompatibility, (2) cognition and personalization, (3) intentions, (4) behavior, and (5) outcomes.
5. Conflict potential.
   • Dyadic conflict. Conflict that occurs between two people usually on personal grounds.
   • Intergroup conflict. Conflict that occurs between different groups or teams.
   • Interrole conflict. A situation in which the expectations of an individual's different, separate groups are in opposition.
   • Intragroup conflict. Conflict that occurs within a group or team.
   • Process conflict. A conflict over how work gets done.
   • Relationship conflict. A conflict based on interpersonal relationships.
   • Role conflict. A conflict that occurs because of divergent role expectations.
   • Task conflict. A conflict over content and goals of the work.
6. Conflict personalization.
   • Felt conflict. Emotional involvement in a conflict that creates anxiety, tenseness, frustration, or hostility.
   • Perceived conflict. Awareness by one or more parties of the existence of conditions that create opportunities for conflict to arise.
7. Conflict intention.
   • Collaborating. A situation in which the parties to a conflict each desire to satisfy fully the concerns of all parties.
   • Competing. A desire to satisfy one's interests, regardless of the impact on the other party of the conflict.
   • Compromising. A situation in which each party to a conflict is willing to give up something.
   • Accommodating. The willingness of one party in a conflict to place the opponent's interests above his or her own.
   • Avoiding. The desire to withdraw from or suppress a conflict.
8. Conflict outcome.
   • Functional conflict. A conflict that supports the goals of the group and improves its performance.
   • Dysfunctional conflict. A conflict that prevents a group from achieving its goals.
9. Stakeholder analysis. The work to identify the stakeholders who may be impacted by a proposed initiative and assess their interests and likely participation.
   • Stakeholder power (high, medium, low)
   • Stakeholder support (positive, neutral, negative)
   • Stakeholder influence (high or low)
   • Stakeholder need (strong, medium, weak)
   • Stakeholder change readiness (unaware – this group has no information about the project; resistant – aware of project and resistant to the changes and impacts the project may bring; neutral – aware of the project and neither supportive nor resistant; supportive – aware of the project and the potential changes and impacts and is supportive; leading – aware of the project and actively engaged to ensure the project’s success).

Roles

1. Work council. A group of nominated or elected employees who must be consulted when management makes decisions involving personnel.
   • Board representative. An employee who sits on a company's board of directors and represents the interests of the firm's employees.
2. Whistle-blower. An individual who raises ethical concerns or issues to others.
   • Whistle-blower. An individual who reports unethical practices by their employer to outsiders.
3. Labor union. An organization that represents workers and seeks to protect their interests through collective bargaining.

Methods

1. Three-step risk evaluation technique. A three-step pattern used to evaluate risks. Risks are identified first, qualitatively analyzed second, and those, that are selected as the most important ones, quantitatively analyzed third.
   • Risk identification. Determining which risks might affect the project and documenting their characteristics. Tools used include brainstorming and checklists.
   • Qualitative risk analysis. Performing a qualitative analysis of risks and conditions to prioritize their effects on project objectives. It involves assessing the probability and impact of project risk(s) and using methods such as the probability and impact matrix to classify risks into categories of high, moderate, and low for prioritized risk response planning.
   • Quantitative risk analysis. Measuring the probability and consequences of risks and estimating their implications for project objectives. Risks are characterized by probability distributions of possible outcomes. This process uses quantitative techniques such as simulation and decision tree analysis.
2. Risk response technique.
   • Risk acceptance. This technique of the risk response planning process indicates that the project team has decided not to change the project plan to deal with a risk, or is unable to identify any other suitable response strategy.
   • Risk avoidance. Risk avoidance is changing the project plan to eliminate the risk or to protect the project objectives from its impact. It is a tool of the risk response planning process.
   • Risk mitigation. Risk mitigation seeks to reduce the probability and/or impact of a risk to below an acceptable threshold.
   • Risk transference. Risk transference is seeking to shift the impact of a risk to a third party together with ownership of the response.
3. Simulation. A simulation uses a project model that translates the uncertainties specified at a detailed level into their potential impact on objectives that are expressed at the level of the total project. Project simulations use computer models and estimates of risk at a detailed level, and are typically performed using the Monte Carlo method.
   • Monte Carlo method. A technique that performs a project simulation many times to calculate a distribution of likely results.
4. Change support analysis. An evaluation of the stakeholder support of the and, vice versa, the resistance to this change.
   • Restraining force. A force that hinders movement from the existing equilibrium (Kurt Lewin).
   • Driving force. A force that directs behavior away from status quo (Kurt Lewin).

Instruments

1. Stakeholder-analysis tool.
   • Power-interest grid.
   • Influence-interest grid.
   • Power-interest-attitude grouping.
2. Probability and impact matrix. A common way to determine whether a risk is considered low, moderate, or high by combining the two dimensions of a risk, its probability of occurrence, and its impact on objectives if it occurs.

Results

1. Risk database. A repository that provides for collection, maintenance, and analysis of data gathered and used in the risk management processes. A lessons-learned program uses a risk database. This is an output of the risk monitoring and control process.

Practices

The successor lecture is Workgroup Design Quarter.