First Tuesday held a seminar on risk management at the Luxembourg Chamber of Commerce in December with two guest speakers, Jan Van Broeck, Executive Partner Threon Europe, and Thibaut Westhof. Faced with the proposed challenge that approximately one third of projects fail, the well attended evening raised some of the issues as to why the failure rate is so high and what preventative measures can be taken.

Van Broeck is a good motivational speaker with a very scientific approach. His focus was the enormous complexity surrounding project management and the need to thoroughly understand the processes before attempting to launch a successful project. His presentation engaged the audience with many real life examples.

For example, he tried to determine the number of people in the room who were "gamblers" (i.e. risk takers) with games of probability involving fictitious lottery scenarios. It was quickly discovered that very few people were willing to play a lottery where either - "the stakes are not high enough" or conversely, the negative impact would be too great. The obvious conclusion was that "in order to reach a next level one has to be risk taking" and "in order to protect one becomes averse".

This, Van Broeck explained, applies to both persons and organisations. He then showed how, within companies, projects can have both a project "gambler" who finds himself with an entirely different risk agenda than an HR "gambler". The result being a situation that he claims happens all too often: two parties drawing different conclusions, two parties using different data, and two parties with different agendas.

His presentation went on to say that risk is only one of the 9 project management knowledge areas and that project risk management has six major processes. The point behind his presentation (and his product PM Talk) is that "project risk management is a continuous link of processes concerned with identifying, analysing and responding to project risks". The more you know in advance, and at each stage of the project, the more likely your project will succeed.

Mr. Westhof gave a presentation looking at risk management from a competitive analysis approach, defending Van Broeck's central thesis. He gave a very startling example of an event he called "a date in risk management history," December 7th, 1941: the day Pearl Harbour was bombed. He used this example because he claimed "all the information was available for the U.S. management" and it serves to prove that it is better to be proactive (prevention through the anticipation of events) than reactive, which he sees as the actual trend at the moment.

He outlined that strategic and competitive analysis are essential for success based on a 3 step approach: information needs analysis, anticipation for action and decision, and recursion - iterative (repetitive) information process). Space precludes going deeper into the analysis which was sometimes heavy going, but both presentations are available at www.firsttuesday.lu to registered members only.