We blogged about hypoxia (this seems surreal) more than three years ago, at which time we referred to our book, Green Project Management, as “our upcoming book”. A lot happens in three years. The book is out, has been recognized with PMI’s highest award for literature, and has been used in University courses on sustainability. And, that book directly covers the topic of hypoxia in the Gulf of Mexico, and today it (hypoxia, that is, not our book) made it into the CBS Evening News:
Dead zones â€” whether hypoxic (very low oxygen) or anoxic (no oxygen) â€” are caused primarily by high-levels of nutrient pollution. This nutrient pollution â€” mostly the fertilizers used in industrial agriculture â€” causes large algal blooms which use up all of the oxygen in a given environment. As a result, the environment becomes devoid of life â€” a â€œdead zoneâ€. These deadzones have been increasing in frequency and scale since at least the 1970s. More than 1.7 million tons of potassium and nitrogen make their way into the Gulf of Mexico every year as a result of agricultural runoff â€” via the Mississippi river.
If the 2013 Gulf of Mexico dead zone becomes as large as is being predicted it will cover an area the size of New Jersey. The 2013 predictions were made by modelers at the University of Michigan, Louisiana State University, and the Louisiana Universities Marine Consortium.
As we will be in Louisiana – New Orleans in particular – at the end of October, for the PMI North America Congress, we bring this again into focus as an example of a trigger for projects in the area of sustainability. Anything that can reduce the flow of chemical fertilizers into the Mississippi, any ‘outcome’ that contributes to the decrease of hypoxia, is a ‘green by nature’ project, so it gets our attention.
And that’s not where it stops. Not by a longshot. Because hypoxia is a good example of the lessons to be learned for the other end – the ‘green in general’ part of the sustainability-in-PM spectrum. We say this because it’s a very real example of how long-term thinking can and should be part of ANY project. If your project produces a steady-state outcome (think: fertilizers into the Gulf) you can work this back into your risk register and an expanded definition of project success that will have you thinking – properly – like a a sustainability-oriented PM, an evolved PM.
In any case – it certainly cannot hurt to get educated about the science of hypoxia.
We look forward to meeting some of you in New Orleans!
It’s now just two years since the Deepwater Horizon incident. Many people seem to forget it. After all, we see the smiling faces of the folks from the tourist industry in Alabama, Mississippi, Florida, and Louisiana on those TV commercials, so it really wasn’t a problem, after all, right?
A NOAA-commissioned study of 32 dolphins living in Barataria Bay, an area of the Gulf known to be heavily oiled, found that many of them were underweight, anemic and showing signs of lung and liver disease. Nearly half were also found to have adrenal insufficiency, a condition that interferes with basic life functions such as metabolism and the immune system.
While most of the dolphins were still alive at the end of the study, researchers have indicated that survival prospects for the sick dolphins are grim. Their prognosis is troubling because the Gulf dolphin population has been facing what scientists call an unusual mortality event over the last two years. Since February 2010, more than 675 dolphins have stranded in the northern Gulf of Mexico – compared to the usual average of 74 dolphins per year – and the majority of those stranded have been found dead.
But dolphins aren’t the only Gulf animals in trouble. Researchers looking at deep ocean corals seven miles from the spill source found dead and dying corals coated in a brown substance that was later chemically linked to oil from the BP Deepwater Horizon spill.
Well, aside from the environmental damage, the damage for the involved project teams continues, now for the first time on the criminal front. And the lesson learned for project teams is that lessons learned should be – must legally be – preserved. When they’re not, you put yourself and your company at criminal risk. And indeed as reported widely today, this has led to the arrest of a BP Engineer.
“Federal investigators have been looking into the causes of the blowout and the actions of managers, engineers and rig workers at BP and its subcontractors Halliburton and Transocean in the days and hours before the April 20, 2010, explosion.
But the case against Mix focuses only on the aftermath of the blast, when BP scrambled for weeks to plug the leak. Even then, the charges are not really about the disaster itself, but about an alleged attempt to thwart the investigation into it.”
Learn from this project and its errors, which have led to 11 deaths, still-being-tallied environmental damage, $40-50B in costs to BP and the other principals, and intangible damage to BP, a company which had to its credit taken some impressive steps into alternative energy and was trying to re-brand itself as “Beyond Petroleum”.
One of the reasons? He – or his company – or perhaps his whole industry – doesn’t seem to understand a simple equation which most project managers know by heart.
RF = P * I
Risk Factor is the product of Probability andImpact.
In any uncertain situation, you should be able to determine how much effort is required to spend in responding to a risk (a threat in this case) by understanding the Risk Factor (some call it Risk Score).
In this case, the probability may be very, very low. But the impact is so astronomically high, that the product – the Risk Factor demands a huge risk treatment or response.
The impact in this case is a combination of very tangible things, like a $20B escrow fund, some mildly tangible things, like the health of one of the world’s most delicate ecosystems and the livelihood of hundreds of thousands of people, and the intangibles, such as the reputation of a multinational corporation which has just spent oodles (our own very technical financial word) of dollars to make their image a very green and friendly one. How’s that working out for you, BP?
So – in that equation, I think we can all agree that no matter how low “P” is, “I” is very, very, high. So the Risk Factor is going to be worth considering.
Just before the explosion of the Deepwater Horizon rig, BP sent home a crew from Schlumberger who was going to do a cement bond log. What is that, you ask? It’s a “representation of the integrity of the cement job, especially whether the cement is adhering solidly to the outside of the casing. The log is typically obtained from one of a variety of sonic-type tools. The newer versions, called cement evaluation logs, along with their processing software, can give detailed, 360-degree representations of the integrity of the cement job.” Seems like a good thing to do – and good assurance that your bond will hold. Right? The cost of this would have been $128,000. This is only one of five decisions being raised at what can only be called the grilling of Tony Hayward. The questions, coming from Republicans and Democrats, from oil states, and states that grow corn, all seem to be going after the companies acknowledgment of the Risk Factor equation above.
There is one point in the dialogue where Hayward seems to recognize the equation – however fleetingly:
“It gets to that point, though, that you have to question every assumption, especially when your entire company and its solvency are on the line.”
…and that equation leaves out the 11 dead, the ecological damage and the fact that the Gulf provides a livelihood for so many people as well as food for the world.
So what’s our point?
Keep the equation handy. Keep it in mind.
Don’t be so fast to save $128,000 when on the other side of the equation there is a tangible $20B, and an even greater list of intangible damages to consider. Your numbers may be lower (hopefully on both sides of the equation) but you will face this same choice. Think of that picture above. Do you want to have to wear that expression?
We’ve heard that oil and water don’t mix. Why not?
From the Argonne National Laboratory: Water molecules have strong bonds with one another, called “hydrogen bonds.” This consists of an extraordinarily strong attraction that the hydrogens of one H2O have for oxygens of nearby H2O molecules. Oil molecules also have very strong bonds with one another, but not hydrogen bonds. Oil molecules are bonded to one another by what are called “London forces,” or sometimes”dispersion forces.” This is a little harder to explain in simple terms, but basically the large oil molecules tend to clump together because of these forces. However, an oil molecule does not hydrogen bond with a water molecule, and an oil molecule’s dispersion attraction to a water molecule is weak compared to the oil-oil attraction. So, the water stays separate from the oil, giving rise to the old chemistry saying “like dissolves like.”
Now, why the science lesson? We think about the Gulf oil spill, and if water and oil don’t mix, what’s the problem? Well, the problem is that the oil is carried by the water to sensitive shoreline ecosystems, causing significant and possibly long-lasting damage.
We blogged back on 22-May regarding Kevin Costner’s investment in Ocean Therapy – a special fleet of boats equipped with high-powered centrifuges that can very effectively separate out the oil and the water from the Gulf oil spill. We covered this in the context of responding to the threat of the spill with a workaround. Project managers have a lot to learn from the Gulf spill in terms of identifying, preparing for, responding to, and knowing the secondary and residual risks of their projects.
From today’s news we find that BP has finally decided to buy these boats and use them to help remove the oil.
We hope that this solution will provide some movement towards removing the oil from the water (as opposed to using dispersants – which have their own secondary risks). We also continue to hope, of course, that the oil leak is properly capped, and that real risk treatment– like always drilling a relief well – are used in the future. Always drilling a relief well, you ask, isn’t that expensive?
Sure it is.
But ask BP about the damage to their stock value, their image, their very survivability. Ask the residents and fisherman and others who rely on the Gulf’s fragile ecosystem. We think the P x I (Probability x Impact) equation yields a risk factor (or risk score) that is high enough to justify that type of investment. And as a project manager, keep these things in mind as you analyze risk.
“A Workaround is a solution to an unanticipated problem. Not to be confused with a contingency, or backup plan, which is conceived in advance, a workaround is a far less elegant solution to the problem. Typically, a workaround is not viewed as something that is designed to be a panacea, or cure-all, but rather as a crude solution to the immediate problem.”
The above is taken from an excellent resource for PMs – a blog called Project Management Knowledge. They have a glossary and this is the definition of workaround. We like it. That is, we like both the site and their definition of ‘workaround’.
At the time of this posting, the Ron Howard movie Apollo 13, starring Tom Hanks, Kevin Bacon, Gary Sinise, and Ed Harris, is showing on Home Box Office (HBO). Also at the time of this writing, the Gulf oil spill continues and repeated attempts to fix it have failed. Attempts with names like Top Hat, Junk Shot, Top Kill, and the latest, Slice and Cap, are a strong giveaway that what we’re working with here are, in fact, clearly workarounds. In fact, we understand that James Cameron has been invited to help solve the problem, based on his work with advanced underwater robotics from his film The Abyss.
The reference to crude, the fact that the new mission of Apollo 13 was to get the astronauts back to Earth, and this being a blog called EarthPM combined with the crude that is pouring into the Gulf and the workaround(s) being attempted to fix that problem seemed to me to have way much too much ‘karma’ to not generate a post – a valuable one, we hope. Oh, wait, there is the other connection of movies to the Gulf with the James Cameron invitation. Wow, that is a lot of karma!
I suggest you start by watching this scene from the movie.
OK, if you have seen the movie, that was a good refresher, right? And if not, suffice it to say that at this point, NASA is furiously searching for a way to save the lives of the astronauts, having scrapped the original objective the moon landing project long ago – just as BP is furiously searching for a way to stop the leak, the lawsuits, the damage to the environment, and to minimize the reputation damage they’ve suffered, to say nothing of avoiding criminal charges, having scrapped the original objective of the well (drawing oil from it to make money).
So let’s bring this back to Project Management again.
When we manage a project, we do a thorough job of Risk Management Planning, including the creation of a Risk Management Plan – to tell us how, in general, we’ll deal with risk on the project. This includes the ways in which we’ll identify risk, and general broad brush plans for contingency management. Up front, in the project, we go through Risk Identification, Analysis (both qualitative, to see which ones have the highest risk factors, and quantitative, to further analyze those with the highest risk factors). Only after we really have a handle on the project’s risks do we go through the details of responding to risk.
Furthermore, even after all this is done, we don’t stop. We monitor and control risks to see, for example, if new risks have popped up, or if our current assumptions are still valid, or if the risk response plans we’ve put in place are working.
So, all that said, what if our risk response doesn’t work?
That’s where the word contingency comes in. Contingency is money, time, or resources (like a life-saving flotation device) set aside to minimize the impact of the risk that is now triggered. These are thought of in advance. In the Apollo 13 dialogue, you hear the engineers actually use this phrase (“we didn’t have a contingency for this”).
On a cruise ship, a fleet of lifeboats on a cruise ship is part of their contingency planning. If contingency is a house pet, a workaround is a very different animal. A workaround, unlike a contingency, is not fed with foresight, softly petted with preparation, not pampered with planning . Instead, a workaround is like having a wild boar, or even more descriptively, a griffin suddenly appear in your living room, hungry, flailing, snorting, and growling. It’s unexpected, and you must deal with it NOW. And it’s really the dealing with the griffin that is the workaround, not the griffin itself, although the imagery was just too good to avoid.
That’s what BP and Transocean and Haliburton and Cameron International (manufacturer of the Blowout Preventer) are facing now. That’s why they’re calling in movie directors and engineers, and 25,000 workers to put together Top Hats, Junk Shots, Top Kills, and Slice and Caps. There was less of a contingency than there should have been to deal with the impact. Once again (and we’ve blogged about this), why wouldn’t the oil industry as whole (if not BP in particular) have had a fleet of the Kevin Costner -funded boats ready to clean up the spill to at least buy a little time? That’s a form of contingency that would have kept the griffins at bay.
Now BP has said that it had a contingency plan, and it’s working – incredibly, they did actually say that, just a few days ago. Read that story here.
Let’s wrap this unusual posting in the following way:
It’s worth it to put the time in up front in a project so that you really understand the risk factors (the probability multiplied by the FULL impact) of all of your risks, and it makes sense to put the time in up front on contingency planning on those risks.