It’s ERM Jim but not as we know it—NASA uncovered

Whilst it is clear that the space agency leaves no stone unturned, it is remarkable how similar its processes are to best practice enterprise-wide risk management, towards which so many organisations strive. Despite the life and death consequences of the success or failure of NASA’s missions, risk management techniques are universal, the space agencies risk manager, Dr Jeevan Perera, told delegates at this week’s IRM forum in Liverpool. “Even though NASA’s risks can often result in loss of human life and tremendous adverse political impacts, our risk processes are probably quite similar to those employed by many other organisations and companies,” he said. As, fundamentally, risk management is used to make risk informed decisions regarding many critical aspects that face an organisation in order to improve its chance of meeting goals and objectives, he continued.hideHowever, the goals and consequent risks taken by NASA are of course beyond the scope of most. For example, the US space agency is currently attempting to land for a prolonged period on asteroids far out in space and to visit Mars. It has target dates of 2020 and 2030 respectively for the accomplishment of each feat. The enormous logistics of travel to Mars are highlighted by the likely six month journey, which compares to a three-day trip to the moon. NASA also wants to extend sustained human presence beyond earth via the introduction of manned space stations. This will need the cooperation of space experts and agencies from around the world. In response Barack Obama has stated that he wants to see the commercialisation of earth’s lower orbit, with NASA taking responsibility for travel beyond. A system similar to the way airflight was developed. NASA also faces the risk of man-made or natural debris in lower space colliding with one of its shuttles. One potential solution, explained Dr Perera, involves space garbage trucks going into orbit to remove or reduce in size the flying objects. Due to the size and complexity of these risks there is no way to ensure all risks are eliminated in space exploration, said Dr Perera. “Risk is intrinsic to any exploration efforts, space is no different. Exploration is done despite the risks, because of the huge potential rewards.” And yet is this really different for any company or organisation—risk cannot be avoided and you must embrace its positives while attempting to reduce its negative impact. “The core tenets and processes of NASA’s risk system are directly transferable to private sector and can aid any risk practitioners in improving how they manage their organisation’s risks,” said Dr Perera. Risk management at NASA was beefed up following the Space Shuttle Columbia accident investigation. It recognised that the 2003 accident was in fact not a random event, but rather likely rooted to some degree in NASA’s history and the human space flight programme’s culture, explained Dr Perera. “The main difference after Columbia is a renewed vigour and reliance in risk analysis and assessments to ensure we reduce the uncertainty in the knowledge about our risks and can make risk-informed decisions,” he said. Enterprise risk management was not prevalent in NASA until that last two or three years, said Dr Perera, but since then it has been core to the organisation’s more integrated and holistic approach to risk management. The re-energised risk process includes implementing risk management throughout all levels of a project and is directly supported by the management boards, forums and oversight meetings to monitor and control risks. Ensuring you have buy-in from top management on risk management should be the number one priority for any risk professional hoping to implement a successful risk management programme, said Dr Perera. Upper management should also provide an oversight for all projects’ critical risks and must remain responsible for the key risks, he continued. At NASA they focus on the top 10 to 15 rated threats. Top management cannot deal with all of the risks associated with space exploration. So NASA employs a more tiered, structured approach to risk identification and management, explained Dr Perera. Every risk that has been identified is assigned a ‘risk owner’ who manages it at the organisational level where budget, resources and technical oversight can be adequately performed. Ensuring that an individual at the lowest appropriate level is accountable for monitoring, implementing and mitigating the effects of a risk is crucial to the success of an organisation’s risk management strategy, said Dr Perera. One of the key elements for risk management is communication, he continued, to ensure that the right information gets to the right decision manager so that they can make the right decision. The key risks for NASA include ensuring safe and reliable access to space, establishing the right level of commercialisation of manned space systems and government developed systems and of course the health and safety of crews as it ventures further into space. NASA’s risk management journey makes it well placed to offer practical advice for effective risk. Job requirements and descriptions for all team-members must explicitly include risk management and there must be a well defined, structured and understood risk management process in place that should be formally documented. The risk system must not be overly complex, because it has to be understood and used by all team members. Risk management should be integrated with programme and project decision-making processes so that all key decisions are risk-based, advised Dr Perera.

It’s ERM Jim but not as we know it—NASA uncovered

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