Gordon Hyland BD Manager Risk Decisions Ltd Risk Decisions, 2012 Commercial in Confidence CROs want: Increased profitability Reputation building activity Increased market share
Speed to key decisions and market Robust processes leading to high quality data Trust and certainty in cost and schedule Innovation
Sponsors want: With risk management all of these can be mutually inclusive
Pain, Pain vs. Pain Gain sharing Realistic and achievable targets Delivering expected outcomes more often Risk Decisions, 2012 Commercial in Confidence Risk managing a bid Sponsor RFP Bid Bid Defence Contract negotiation meeting Scenario analysis Pre-prepared risk register Identify additional risks Sensitivity analysis Analyse risks in proposal Check / adjust schedule Check / adjust pricing Response determination Mobilise resources
Risk register from bid Review mitigation plan & agree risk ownership Scenario analysis Refresh baselines Risk Decisions, 2012 Commercial in Confidence Risk Decisions, 2012 Commercial in Confidence Risk managing a bid Sponsor RFP Bid Bid Defence Contract negotiation meeting Scenario analysis Pre-prepared risk register Identify additional risks Sensitivity analysis Analyse risks in proposal Check / adjust schedule Check / adjust pricing Response determination Mobilise resources Risk register from bid Review mitigation plan & agree risk ownership Scenario analysis Refresh baselines Are we in or out? Risk Decisions, 2012 Commercial in Confidence Risk managing a bid: Identify risks on key tasks and assumptions Description, cause, consequence Risk based schedule analysis What confidence do you have for delivering on time? What can you do to improve your confidence? Focus on key risks that drive the critical path Develop your risk response Determine mitigation actions Cost the actions and build into the base cost
Risk Decisions, 2012 Commercial in Confidence Risk Decisions, 2012 Commercial in Confidence Risk Decisions, 2012 Commercial in Confidence Risk Decisions, 2012 Commercial in Confidence Risk Decisions, 2012 Commercial in Confidence Risk Decisions, 2012 Commercial in Confidence A simple Gantt chart from a project plan showing tasks on the critical path excluding any risk information. This task appears most crucial and as having the greatest impact on potential late delivery Risk Decisions, 2012 Commercial in Confidence A Gantt chart for the same project plan. Showing critical tasks on the path including the addition of risk information. Note how the cruciality of activities have changed. This task is no longer the most crucial. Therefore we should focus effort on other activities. These tasks now have a greater impact on delivering to schedule. So focus is required here. Risk Decisions, 2012 Commercial in Confidence Scenario Analysis - Sample Outputs 22 week deadline, 10 sites, What is the probability of success? 22 weeks falls at 50% P level Very low P of < 20 weeks In some cases deadline could missed by several weeks Weeks Risk Decisions, 2012 Commercial in Confidence Scenario Analysis - Sample Outputs 22 week deadline, 12 sites, What is the probability of success? Probability at 22 weeks increased to 90% Probability of late finish reduced Weeks Risk Decisions, 2012 Commercial in Confidence Risk managing a bid: Analyse costs What contingency budget do you need? What price to bid? Understand the remaining exposure
Risk Decisions, 2012 Commercial in Confidence B e s t
c a s e
W o r s t
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B u d g e t
Budget Exposure Profit Pricing analysis More Competitive but less profit Fewer wins but higher profit B i d
Losses? Pain / Gain Share? Negotiation? Insurance? Project Cost 17 Risk Decisions, 2012 Commercial in Confidence Risk managing a bid Sponsor RFP Bid Bid Defence Contract negotiation meeting Scenario analysis Pre-prepared risk register Identify additional risks Sensitivity analysis Analyse risks in proposal Check / adjust schedule Check / adjust pricing Risk register from bid Review mitigation plan & agree risk ownership Scenario analysis Refresh baselines Response determination Mobilise resources Increased confidence in price and schedule Are we in or out? Risk Decisions, 2012 Commercial in Confidence Scenario Analysis Longer Timescale Tight scope Quality Cost Schedule 19 Higher cost Tight scope Scope Risk Decisions, 2012 Commercial in Confidence Option 3 Scenario Analysis Option 1 Option 2 Risk Decisions, 2012 Commercial in Confidence Risk managing a bid Sponsor RFP Bid Bid Defence Contract negotiation meeting Scenario analysis Pre-prepared risk register Identify additional risks Sensitivity analysis Analyse risks in proposal Check / adjust schedule Check / adjust pricing Risk register from bid Review mitigation plan & agree risk ownership Scenario analysis Refresh baselines Response determination Mobilise resources Are we in or out? Increased confidence in price and schedule Demonstrate confidence, credibility and innovation Risk Decisions, 2012 Commercial in Confidence Contract negotiation meeting Do your risk registers Plan your actions Check your costs & schedule APPLY CHANGES Learn and create a virtuous circle for future projects
Is this a confrontational approach? Risk Decisions, 2012 Commercial in Confidence Risk managing a bid Sponsor RFP Bid Bid Defence Contract negotiation meeting Scenario analysis Pre-prepared risk register Identify additional risks Sensitivity analysis Analyse risks in proposal Check / adjust schedule Check / adjust pricing Risk register from bid Review mitigation plan & agree risk ownership Scenario analysis Refresh baselines Response determination Mobilise resources Are we in or out? Increased confidence in price and schedule Demonstrate our confidence, credibility and innovation Tailor the offer to key drivers Risk Decisions, 2012 Commercial in Confidence
Identify which trials to prioritise focussing resources to achieve the best chances of success Create opportunity to make better informed strategic decisions Protect budgets, profit margins and enhance reputation
Easier portfolio resource planning and allocation More effective budget management for projects Reduce cost and time wasted dealing with change requests
Improve trust & confidence in targets Risks dealt with in the most appropriate place Help projects complete on time and to budget For the CRO For sponsors For all 24 Summary of benefits Commercial in Confidence