Risk Management - You Don't Have to Waltz with Bears

I recently finished reading Waltzing with Bears: Managing Risk on Software Projects by Tom DeMarco and Tim Lister, both recognized experts in software development and risk management. The material in this book covers much of the same territory as courses that I attended several years ago in software project management and risk management presented by these authors through The Atlantic Systems Guild.

This work is based on their experience as consultants and as expert witnesses in contract disputes and litigation over software project failures. The authors make a strong case that effective risk management is essential to the success of any software project worth doing; that you must be prepared to face failure and deal with uncertainty; that you must actively manage risks, by containing risks through schedule and budget buffers, or proactively mitigating risks by taking steps to reduce the probability and/or impact of a problem; that you must consider alternatives for any critical activities or work items; and that managing for success, attempting to evade risks, is the path to failure.

Waltzing with Bears focuses on the kinds of problems faced by (and effectively created by) large waterfall projects: trying to commit to scope and schedule and cost up front when there isn’t enough information to do so; and trying to account for and manage the unknown and unaccountable. It’s an almost hopeless situation, but the authors provide ideas and disciplines and tools that at least offer a better chance at success.

What’s necessary is to change the rules of the game, to consider other ways of building software.

In an earlier post, I explored how risk management can and should be burned into the way that you develop software; how schedule and scope and quality risks and other risks can be managed through the development lifecycle you choose and the engineering practices that your team follows. Johanna Rothman, in a paper titled “What Lifecycle: Selecting the Right Model for your Project” explores some of the same ideas, how to manage schedule risks and other risks through lifecycle models, in particular incremental and iterative development approaches.

It is clear to me that following incremental, iterative, timeboxed development, as in Extreme Programming and Scrum, will effectively mitigate many of the common risks and issues that concern the authors of Waltzing with Bears. To some extent, the authors agree, when they conclude that

“The best bang-per-buck risk mitigation strategy we know is incremental delivery” (by which they mean Staged Delivery), “development of a full or nearly full design, and then the implementation of that design in subsets, where each successive subset incorporates the ones that preceded it”.

While Scrum (interestingly) does not explicitly address risk management; it does mitigate scope, schedule, quality, customer and personnel risks through its driving principles and management practices: incremental timeboxed delivery (sprints), close collaboration within a self-managing team and with the customer, managing the backlog (scope) together with the customer (Product Owner), and daily standup meetings and retrospectives which allow the team to continuously adjust to issues and changes.

Extreme Programming (XP) recognizes and confronts risk directly and fundamentally – chapter 1 of Extreme Programming Explained: Embrace Change begins:

“The basic problem of software development is risk”.

In The Case for XP Chris Morris explains that XP is resilient to risk, that it inherently accepts change and uncertainty, rather than attempting to anticipate risk, to predict and manage dangers up front; building on a risk management model developed by political scientist Aaron Wildavsky.

XP addresses risk through:

- short iterations with fine-grained feedback

- keeping the customer close

- test-driven development to maintain a quality baseline

- refactoring and pair programming to ensure code quality

- continuous integration

- simple design

While you can manage most types of risks effectively through your SDLC especially by following incremental, iterative techniques and disciplined engineering practices, there are two general classes of risk that require active and continuous risk discovery and explicit risk management, using tools and ideas such as the ones detailed in Waltzing with Bears, Steve McConnell’s Top 10 Risk List, and the formal methods and techniques taught by the Project Management Institute (this is where my PMP comes in handy):

1. Project risks outside of your team’s work in software development, but which directly impact your success. These include: sponsor and stakeholder issues and other political risks, larger business issues outside of your control, regulatory changes, reliance on delivery from partners and sub-contractors, implementation and integration with partners and customers.

2. Technical risks in the platform, architecture or design. This is especially important if you are building enterprise, high reliability systems such as a telco, banking systems, large e-commerce sites, or financial trading. Some lifecycle and SDLC factors help to mitigate technical risks, such as prioritizing work that is technically difficult in XP, or using exploratory prototyping not only for customer feedback but for technical proof of concept work. But to ensure that your product works in the real world, the team constantly needs to consider technical risk: difficult problems to solve; fragile or complex parts of the system; areas where you are pushing beyond your technical knowledge and experience. Using this information you can determine where to focus your attention in technical reviews and testing; what to try early and prove out; what to let soak; what you should have your best people work on.

If you are building software incrementally and carefully, you won’t have to “waltz with bears”, but you still need to continuously look for, and actively manage, risks inside and outside of the work that your team is doing.