Programmatic Risk Analysis for Critical Engineering Systems Under Tight Resource Constraints

Stanford University, Stanford CA

Investigators

Abstract

PROGRAMMATIC RISK ANALYSIS FOR CRITICAL ENGINEERING SYSTEMS UNDER TIGHT RESOURCE CONSTRAINTS ABSTRACT Engineering projects are continually expected to accomplish more with fewer resources, and the dependencies among these projects are increasing. At NASA, for example, faster-better-cheaper (FBC) projects are being managed as programs to enhance the benefits of synergies among smaller projects, and to attenuate the risks of single large missions. Under tight resource constraints, FBC project managers must balance several types of failure risks including the effect of their project's performance on future missions. Existing risk analysis models generally focus on the quantification of either technical or management risks. Since it is difficult to balance simultaneously cost, schedule and performance of a given project as well as their effects on other projects, managers who face these problems can benefit from an integrated programmatic risk analysis. The goal of the proposed study is to develop a theoretical framework to integrate the analysis of both technical and management risks. It will be designed to quantify the tradeoffs among these two types of risk and to optimize a project's technical design and budget allocation. We will then incorporate into the model the effects of various amounts of testing and reviews, partial mission failures, and project dependencies within programs. Also, since current management decisions are often made based on intuition and an implicit reward system, we will capture these preferences in an illustrative example with a utility or valuation function that represents the objectives of the organization and its managers. This generic framework for modeling programmatic risks will be developed to support the management of interdependent projects within programs in different industries. An illustration will be provided based on the management of unmanned space missions and programs, and data available at NASA/JPL and its contractors.