Original Date: 04/20/1998
Revision Date: 01/18/2007
Best Practice : Risk Management Process
In the past, ITT Aerospace/Communications Division (A/CD) only used risk management in preparation for production transitions. This was an intermittent practice which focused on reactive solutions to problems. However, the demand for quicker development times for its commercial satellite deliveries motivated ITT Aerospace/ Communications Division to establish a risk mitigation tracking tool. In 1994, the company set up a formal Risk Management process to identify and eliminate potential problems before they can impact the completion of a program.
ITT A/CD’s Risk Management process works as an integral part of the Product Development process, and evaluates all facets of risk items (e.g., hardware, software, programmatic components). Program personnel identify how risk will be measured, and define the major risk decision points in the program’s process. A key feature of the Risk Management process is assessing program issues that the customer considers absolutely necessary. Known as cardinal points, these issues are collectively viewed by ITT Aerospace/ Communications Division and the customer, and are addressed through concerted efforts. Key program personnel then evaluate the program’s objectives and cardinal points, and assign a risk factor to each. The risks are then prioritized, and the top 25 risks are incorporated into a Risk Mitigation Strategy. Since this strategy is also part of the Program Management process, the company gains a global view of the program by addressing risks early. The Risk Management process helps to clearly delineate the interrelationship of the program’s components for the staff, and allows the customer and program managers to be involved in decisions up front. Figure 2-5 shows the flowchart of the Risk Management process.
ITT A/CD’s Risk Management process addresses risk items early in the Program Development process. This approach provides objective decisions on mitigation plans; enables the highest impact issues to receive attention first; prioritizes the assignment of resources; keeps the customer and program management focused on the cardinal points; and works as a proactive process. As a result, ITT Aerospace/ Communications Division now accomplishes its commercial satellite deliveries in half the time and under budget.
Figure 2-5. Risk Management
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