Advanced Risk Management Tools & Techniques (4 days)
This course provides a thorough treatment of the tools and techniques of risk management on projects. It provides an overview of the dominant standards for risk management in the upstream oil & gas sector and an in-depth introduction or review of the thirty risk assessment tools and techniques of the ISO 31010 standard.
A structured process approach to project risk management, with its positive and negative aspects, has been a phenomenon of the 21st century. For projects in the upstream oil industry service sector, this structured process is directed by four professional standards – API Q2, ISO 9001, the PMBOK® Guide, and ISO 31000. API Q2, released in 2011, stated: “The organization shall maintain a documented procedure to ensure that competent individuals … control risk throughout the provision of a service.” ISO 9001, as updated in 2015, includes the expression “risk-based thinking” throughout the Quality standard. The PMBOK® Guide has always included process steps for risk, now with the latest version 6 released in 2018, PMI includes seven process steps. Hundreds of project managers have received training in PMBOK® Guide processes through NExT in the last two decades in over a dozen countries. ISO 31000, probably the least known of the four standards, is the ISO’s standard for risk management (first issued in 2009). A subordinate standard, ISO 31010 delineates a large set of tools and techniques for performing risk assessment.
All of these standards are explained and all of the ISO 31010 risk assessment techniques are taught, demonstrated or practiced in the Advanced Risk Management Tools & Techniques class.
Standards and Roles for Risk Assessment in upstream oil & gas
- Risk Standards (API Q2, PMBOK® Guide, ISO 31000) available
- Comparison of Standards
- Similarities of Risk Processes across Standards
- ISO 31000 Risk Process Framework
- Roles and processes for risk assessment during Tender
The focus of this day is to acquaint and deepen the understanding of the learners in the established standards fro risk management in upstream oil and gas. This will serve to give project managers from oil producing and service companies an understanding of what their expectations should be for project risk management on engagements should be in the 21st century. Additionally this day begins the review of ISO 31000 processes with the special needs for rapid quantified risk assessment during the Tender stages of a project.
Risk in the Pre-Award Phase of a Project
- Processes for the Quantification of Risk using Monte Carlo techniques during Tender
- ISO 31000 Risk Process Steps
- The whole set of ISO 31010 Assessment Tools and Techniques
- Methods for Making Choices in Assessment
- Identifying and Overcoming Biases in Assessment Choices
Learners will be shown the choices and steps for building a Monte Carlo model of project risks. Learners will practice the roles experienced engineers and project managers play in assisting the risk analysts running Monte Carlo models during the Tender stage of an upstream project. Additionally, the class will learn the menu of Risk Assessment tools and techniques available to project managers in upstream oil & gas and how to identify and overcome the natural biases that can impact decision making about techniques.
Risk Assessment during the Post-Award Planning and Execution Phases of Projects
- ISO 31010 Lookup Methods
- ISO 31010 Supporting Methods
- ISO 31010 Scenario Analysis
The focus of this day is how choices between subjective and quantitative data are made. Learners will evaluate decisions made in real-world upstream examples. This day will begin familiarization with all of the categories of ISO 31010 risk assessment techniques listed above, with deep dives, and practice in those tools and techniques of utility to upstream projects.
Risk Assessment and Communications during the Post-Award Planning and Execution Phases of Projects
- ISO 31010 Function Analysis
- ISO 31010 Controls Assessment
- ISO 31010 Statistical Methods
- ISO 31000 Risk Treatment, Monitoring, Reviewing, and Reporting
- Communicating about Risk
The focus of this day is familiarization with all of the categories of ISO 31010 risk assessment techniques listed above, with deep dives, and practice in those tools and techniques of utility to upstream projects. This day will wrap up the discussion of ISO 31010 assessment methods and focus on the active reporting, model updating, and communicating of risk during the execution of upstream projects.
Project Managers, people working in Project Management Office, people working on risk quantification (such as contracting and tender teams).
Minimum of 3 years of project management experience and attendance in a Fundamentals of Project Management course. PMP certification preferred.