Sunday, March 30, 2008

A verse on risk

...actually, it's more like prose...

We start with a story from the 30-March Boston Globe Magazine, in honor of the opening week of baseball!

NOTE: I know that many of my readers are from outside the US and/or are not fans of baseball. I also know that the rules of baseball are a bit...shall we say...eccentric.

For that reason, if you want to learn about baseball before (or after) reading this snippet, click HERE. To see a short video of the featured player stealing a base, click here.


On June 30 of last year, a call went from Boston to Pawtucket, (note: his means from the Red Sox' major league franchise to the minor league franchise) and Jacoby Ellsbury became the first person of Navajo descent to play Major League Baseball. A few days later, in only his third big league game, he hit a single in the bottom of the fourth. When he stole second, that energized the fans who had heard about this kid from the minors with lightning in his feet. But he was just getting warmed up. With Dustin Pedroia at the plate, and two outs, Texas Rangers reliever Willie Eyre hurled a pitch that hit the dirt, bounced off the catcher, and shot toward the visitor's dugout. Ellsbury had taken his normal jump for third, but when he saw the ball bounce, he thought to himself, "Oh, I might have a shot at this." He flew to third and kept going, not even looking at the third base coach for instructions but instead relying on the instinct inside him that told him to keep charging home.

"Ellsbury to third," play-by-play announcer Don Orsillo said, his voice rising. "He's going to try two bases, and SCORE!"
With two outs, Ellsbury's brash base running could have easily ended the inning. And that prospect - probability even - would have been reason enough for most big leaguers to put the brakes on, never mind a guy who could claim exactly two games of Major League experience more than the kids hawking overpriced hot dogs to fans in the stands.

After getting called up, most rookies approach their early games with the baseball equivalent of that famous medical maxim foremost in mind: First, do no harm. Don't risk anything that might prompt a quick return to the minors. To Ellsbury, that cautious approach couldn't be more wrong.


So we could say that Jacoby Ellsbury is a Risk Seeker. And project managers should be aware that there is an entire spectrum of risk behavior, with risk-averse (or here even "risk-paranoid) being at one end and risk-seeking (or even risk-addicted) at the other. See the following chart in which we move from low levels of uncertainty on the left to high levels of uncertainty on the right, and on the vertical axis we see the person's resulting comfort level. In the baseball scenario above, the speedy Jacoby Ellsbury was comfortable stealing two bases and risking his team an out - but even more significantly, risking his own chances and future in a lucrative career in Major League Baseball - for the opportunity he had to steal those bases and the 'gut feeling' he obviously had about his ability to get home and safely score a run.

In a project, we need to first identify the full complement of stakeholders - anyone who is a participant or otherwise affected by the project - and after that we need to know some key attributes of each one of these stakeholders, including communications needs and their risk attitudes. The chart above illustrates the variety of risk attitudes than can exist amongst stakeholders.

And here's a handy table of sorts that can help you identify how some of the more common risk attitudes affects stakeholders' behaviors for your project.

Risk Averse:

  • can't stand ambiguity

  • wants facts more than theories

  • may over-react to threats

  • may not react fully to opportunities

  • good person to have when you are identifying project risk

Risk Tolerant:

  • Will take uncertainty in stride

  • May not connect the project objectives to the threats and opportunities (it's your job as a PM to help them do that!)

  • Will be unlikely to be proactive - will wait to react

Risk Neutral:

  • Capable of thinking abstractly, willing to create without consideration of uncertainty

  • Balanced and reasoned approach to risk

  • Longer-term thinking

Risk Seekers (like Jacoby Ellsbury):

  • Adaptable and resourceful

  • Casual approach towards threats

  • Thrill of hunt outweighs potential for danger during hunt

  • Will NOT be good at identifying project threats

A new book on Risk has just arrived at my desk. I'm in the midst of reading it. I like what I see so far very much. Risk attitude is covered . The book is by David Hillson and Peter Simon, and it's entitled, Practical Project Risk Management - the ATOM Metodology. You can click on th title to have a look at it on ball. May the best team (it happens to be the one with Jacoby Ellsbury on it) win (again) this year!

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