4 How well are your important projects doing? Measuring the risk state of your project Key stakeholders need accurate, relevant information so they can make effective decisions to mitigate risks and improve project success. All too often, project status reporting does not give leadership a true picture of how a project is doing until it is too late. There is usually political pressure to keep a project in a “green” status; there is also a tendency for information to get distorted as it is rolled up from the workstream level to the project level to the executive reporting level. This distortion and loss of transparency results in executives having an unwarranted optimism concerning the true project performance and its chances of success, which almost always leads to surprises arising late in the project execution. Determining the true risk state of the project involves looking objectively at both a non-distorted view of the current state performance across several dimensions, and at a forward predictive view. This means that the organization’s leadership can proactively make fact-based decisions that will have a direct impact on project success. Risk state analysis It is important to look not just at the discrete risk items, but, more importantly, the risk interdependencies across several dimensions. EY’s “Cube” framework has three primary domains — program governance, project management and technical solution — with For more information on how each domain having nine areas. The risk state of the project takes a multi-dimensional understanding the risk state risk view by assessing the risk of a total of 27 areas based on the type and complexity of of your important projects the project, plus the interdependencies among each facet across domains. can unlock the value of your After the initial risk state is identified and the desired risk state is determined, remediation program investment, please plans can be put in place to improve the chances of project success. When determining see our Building confidence in the desired risk state, the goal is not necessarily to get the entire cube “green” — the goal executing IT programs report. should be to focus on the root-cause drivers and specific areas that will have the greatest impact on planned benefits and outcomes. Also, care must be taken to ensure that the ey.com/ITprm risk and opportunity plans are sequenced appropriately to mitigate risks in the most effective order and to maximize opportunities. 10 | Unlocking the value of your program investments