Managing the Unknown (Loch, DeMeyer, Pich 2006)

A New Approach to Managing High Uncertainty and Risk in Projects

"Managing the Unknown, is an important book, and it was a revelation for me. It takes a fresh look at project risk management, which is a vital skill in developing a new product, but goes beyond conventional risk management in critical ways." (Journal of Product Innovation Management, October 2006)

Product Description
Managing the Unknown offers a new way of looking at the problem of managing projects in novel and unknown environments. From Europe's leading business school, this book shows how to manage two fundamental approaches that, in combination, offer the possibility of coping with unforeseen influences that inevitably arise in novel projects:
* Trial-and-Error Learning allows for redefining the plan and the project as the project unfolds
* Selectionism pursues multiple, independent trials in order to pick the best one at the end

Managing the Unknown offers expert guidelines to the specific project mindsets, infrastructures, and management methods required to use these project management approaches and achieve success in spite of unforeseen obstacles. This book equips readers with:
* Causal explanations of why unforeseeable factors in novel projects make traditional project planning and project risk management insufficient
* Directly applicable management tools that help managers to guide novel and high-uncertainty projects
* Real-world case studies of both successful and unsuccessful approaches to managing high uncertainty in novel projects

p.103 Learning in projects is the flexible adjustment of the project approach to the changing environment as it occurs; these adjustments are based on new information obtained during the project and on developing new - that is, not previously planned - solutions during the course of the project.

p.119 information is most valuable if it is gained early. Chances of early success are small, but the costs are almost always lowest at the beginning, and opportunities fro learning are great. Thus, the organization must anticipate and exploit early information if it is to benefit from early probing. If early experience cannot change later actions, the organization cannot benefit from experimentation.

p.129 Not all these experiments were launched at the same time, but they were seen as true alternatives, not as "competing" but as feasible options that needed to be explored in order to make an informed choice.

p.147 Value Comparison of Darwinian Selection and Sequential Learning

In addition to, and separate from, the costs of obtaining a problem solution, we must consider the value of the solution found. Value refers to the quality or performance of the output achieved by the (sub) project... The value comparison may be even more important than the cost comparison... In this section, we first examine the "pure" case of Darwinian selection, where unk unks are revealed in competition among the final project outcomes, the best of which is chosen ex post.

p.148 However, in complex projects, new information may or may not be very useful to us. The unk unks, as they are revealed, may be important to us, but the project performance landscape is so complex that we cannot easily use this new information to improve the path that we are currently executing.

p.167 In planned projects with variation and foreseen uncertainty, the key ability of the project manager is to be a master planner, an efficient administrator, and a problem solver. He or she must spot deviations from the plan, solve the underlying problems (or have them solved), and expedite the project within the existing framework of the organization.

p.168 Idea generator. This refers to synthesizing information from different sources (such as markets, clients, technologies, and processes) to create ideas for opportunities and solutions. When unk unks emerge, this role will be required not only at the beginning (to create good solutions) but repeatedly over the course of the project as new problem solving must be performed out and as multiple design-check-act testing cycles are carried out. Most likely, this role will have to spread over a larger fraction of the project team than in a routine project, where disciplined execution is the main task.

p.170 The culture of alertness is well captured in Weick and Sutcliffe's concept of mindfulness... Mindfulness has five components. 1. Preoccupation with failure... 2. Reluctance to simplify... 3. Sensitivity to operations... 4. Commitments to resilience... 5. Deference to expertise.

p.267 One important aspect of this culture is mindfulness, the ability to detect and respond to unexpected events in novel projects.

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