e-Talk Radio: DeMarco, Tom, 22 February 2001

DeMarco has been talking about, and function point analysis as one of the tools, one of the metrics that you can use. If anyone is interested in receiving one of these paper calendars, please send me your full mailing address to: dekkers@qualityplustech.com. I am going to give out the toll-free number one more time: 866-277-5369, and that's toll-free anywhere in the United States or Canada.

And I would like to welcome Tom DeMarco back to the show. We had a caller who was asking about how to manage risks. I absolutely love the way you put it, Tom. Which is, "Risk is always packaged with opportunities." So, say we embrace risk and we say, "Yes, we'll go into these risky projects." How do manage risk? Isn't that like a really hard thing to do?

TOM: Well, it is a hard thing to do. The most important aspect of managing risks is to face up to uncertainty. In order to say that you really have managed risk, you have to be able to point to explicit declarations of what you're uncertain about. In particular to say, "I'm uncertain about this delivery date. I can...it may be as early as June of next year, but it could well stretch out until January of 2002." When indeed that is how uncertain you are. In some organizations it is absolutely impossible to show uncertainty. It's okay to be wrong, but it's not okay to be uncertain. Or, if it's okay to be uncertain, it's okay to be uncertain with a very, very narrow window. So, for instance, if you said, "I can't tell you for sure whether we'll be done June 15th or June 30th," people will accept that as a reasonable window. Now, unfortunately, that's not a reasonable window at all. Given the deviations from plan that we've experienced in our history, in our recent history, as IT managers, the deviation from plan of 2% is unthinkable. We are much more likely to have deviations from plan on the order of 50%. So, saying it will take from 18 to 30 months to get this job done, that would declare uncertainty that is consistent with a kind of uncertainty we've seen in the past. But that would be politically unacceptable, that your boss might be well willing to hear you say, "It will take us from 18 months to 18 months and two weeks." But not to say from 18 to 30 months. The truth of the matter of is, there is a lot of uncertainty. And the thing that is really hard about risk management is it forces you to declare your uncertainty, to show the entire range. And that is a risky business in some companies. In some companies, you just can't admit to being uncertain; it is better to be certain that you do it in 18 months and then actually do it in 30 months, that's okay. But you declare up front your uncertainty is unacceptable, and if that's true in your company, that you're not allowed to show any uncertainty, that it's not that the macho of management doesn't allow that, then you're in the situation you'd be in if I showed you how to play an octave with one hand on the piano, but your hand wasn't big enough. In other words, you understand what is required, but you just can't do it. And I'm afraid that this is the situation in many blaming cultures, where risk management is effectively impossible.

CAROL: Now, in a lot of those cultures, I've seen these estimating tools, and I

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