NASA Risk Management Metrics — Evaluating the Effectiveness of the Risk Management Process

The goal of Risk Management (RM) is to identify and mitigate problems before they become detrimental to a project. Lessening the impact to the project from risks being realized can result in substantial monetary savings for NASA, and is critical for projects to maintain schedules and forward momentum. Realized risks, or problems, that have either already occurred or are currently inevitable regardless of the risk management strategy, are categorized as “Issues” by NASA. The purpose of this research is to determine how well projects predict Issues from their inventory of risks. While one cannot examine Issues that were successfully prevented from occurring, we can examine if the Issues that did occur were foreseen. The researchers collected data from the project monthly reports for ten projects and compiled them in spreadsheets for further analysis. A column was created for each month to assemble a time line, recording when each Risk and each Issue were reported over the project life cycle. By organizing the Risks and Issues in this manner, the analysis examined if Issues all originated from previously identified Risks. We would propose that if all Issues were previously identified as Risks, this is an indication of a well-functioning RM process. In addition to providing this insight for each individual project, once completed for all projects, the data can be compared project-to-project, between projects of the same mission class, and between projects at specific life cycle phases. This is very valuable insight into individual projects and the overall RM process effectiveness, providing a path toward consistency, better effectiveness, and improved methods for tracking progress. For the set of projects reviewed, the results are helpful in understanding how well RM processes are documenting Risks before they become Issues, and therefore informing management of the potential problems before they arise.