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Systemic risk assessment: a case study

Author

Listed:
  • F Ackermann

    (University of Strathclyde)

  • C Eden

    (University of Strathclyde)

  • T Williams

    (University of Southampton, Southampton)

  • S Howick

    (University of Strathclyde)

Abstract

Project Risk Registers have been used extensively for many years. However, they do not account for the interaction between risks, for example, the occurrence of one risk exacerbating other risks or portfolios of risks being more significant than the sum of the individual risks. This leads to the need to consider ‘risk systemicity’ as a part of risk analysis. This paper reports on a specific case for a large multinational project based organization, one that the authors had been involved with in the analysis of a number of projects that had massive cost overruns. Following these analyses the organization was persuaded of the importance of risk systemicity. The organization therefore engaged the authors to develop a ‘Risk Filter’. This filter is a tool for identifying areas of risk exposure on future projects and creating a framework for their investigation. The ‘Risk Filter’ is now used on all projects ever since its introduction; by the end of May 2003 it had been used by nine divisions, on over 60 major projects, and completed by 450 respondents. It is also used at several stages during the life of a project to aid in the risk assessment and management of each project, and contributes to a project database.

Suggested Citation

  • F Ackermann & C Eden & T Williams & S Howick, 2007. "Systemic risk assessment: a case study," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 58(1), pages 39-51, January.
    • Handle: RePEc:pal:jorsoc:v:58:y:2007:i:1:d:10.1057_palgrave.jors.2602105
    DOI: 10.1057/palgrave.jors.2602105
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    References listed on IDEAS

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    1. Fran Ackermann & Colin Eden & Terry Williams, 1997. "Modeling for Litigation: Mixing Qualitative and Quantitative Approaches," Interfaces, INFORMS, vol. 27(2), pages 48-65, April.
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    4. C Eden & T Williams & F Ackermann & S Howick, 2000. "The role of feedback dynamics in disruption and delay on the nature of disruption and delay (D&D) in major projects," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 51(3), pages 291-300, March.
    5. John D. Sterman, 1989. "Modeling Managerial Behavior: Misperceptions of Feedback in a Dynamic Decision Making Experiment," Management Science, INFORMS, vol. 35(3), pages 321-339, March.
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    7. James P. Walsh, 1995. "Managerial and Organizational Cognition: Notes from a Trip Down Memory Lane," Organization Science, INFORMS, vol. 6(3), pages 280-321, June.
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    Cited by:

    1. Bloomfield, Katherine & Williams, Terry & Bovis, Chris & Merali, Yasmin, 2019. "Systemic risk in major public contracts," International Journal of Forecasting, Elsevier, vol. 35(2), pages 667-676.
    2. Qazi, Abroon & Simsekler, Mecit Can Emre, 2023. "Nexus between drivers of COVID-19 and country risks," Socio-Economic Planning Sciences, Elsevier, vol. 85(C).
    3. Abroon Qazi & Mecit Can Emre Simsekler, 2022. "Prioritizing interdependent drivers of financial, economic, and political risks using a data-driven probabilistic approach," Risk Management, Palgrave Macmillan, vol. 24(2), pages 164-185, June.
    4. Akbari Ahmadabadi, Ali & Heravi, Gholamreza, 2019. "Risk assessment framework of PPP-megaprojects focusing on risk interaction and project success," Transportation Research Part A: Policy and Practice, Elsevier, vol. 124(C), pages 169-188.
    5. Igor Pyrko & Colin Eden & Susan Howick, 2019. "Knowledge Acquisition Using Group Support Systems," Group Decision and Negotiation, Springer, vol. 28(2), pages 233-253, April.
    6. Thordur Vikingur Fridgeirsson & Helgi Thor Ingason & Haukur Ingi Jonasson & Bara Hlin Kristjansdottir, 2021. "The VUCAlity of Projects: A New Approach to Assess a Project Risk in a Complex World," Sustainability, MDPI, vol. 13(7), pages 1-13, March.
    7. Marshall, Alasdair & Ojiako, Udechukwu & Wang, Victoria & Lin, Fenfang & Chipulu, Maxwell, 2019. "Forecasting unknown-unknowns by boosting the risk radar within the risk intelligent organisation," International Journal of Forecasting, Elsevier, vol. 35(2), pages 644-658.
    8. Colin Eden & Fran Ackermann, 2014. "‘Joined-Up’ Policy-Making: Group Decision and Negotiation Practice," Group Decision and Negotiation, Springer, vol. 23(6), pages 1385-1401, November.
    9. J Davis & A MacDonald & L White, 2010. "Problem-structuring methods and project management: an example of stakeholder involvement using Hierarchical Process Modelling methodology," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 61(6), pages 893-904, June.
    10. Thordur Vikingur Fridgeirsson & Helgi Thor Ingason & Svana Helen Björnsdottir & Agnes Yr Gunnarsdottir, 2021. "Can the “VUCA Meter” Augment the Traditional Project Risk Identification Process? A Case Study," Sustainability, MDPI, vol. 13(22), pages 1-13, November.

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