risk management software

It’s a familiar scenario. Your project is high value and highly specialised, and having the right risk management software in place is going to be crucial. You have the budget in place to implement it. The question is now, do you build your own specialised risk tool, or do you buy a Commercial-Off-The-Shelf (COTS) tool? In other words, will you make or buy? It’s a question many project managers face, and the choice you make can impact your project significantly.

Per Åkesson, project manager at Faveo in Sweden, has experienced both scenarios. He has worked as project manager on the Malmö City Tunnel, which had its own, in-house risk tool and on the Fehmarnbelt link, a tunnel between Denmark and Germany, which uses Risk Decisions’ Predict! risk management software. In this interview, he shares his experience and draws a conclusion.

The Malmö City Tunnel was a very successful project, delivered six months early and under budget. Why did you decide to build your own risk tool?
‘One of the main requirements for this project was that our contractors had to be involved i Malmö City Tunnel Project Description

n the risk management throughout. We felt that the only way to achieve this was to give them online access to our risk database. This was in 1999, and at the time, the best thing we could find was an Access database which didn’t allow for simultaneous online access for users. We were unable to find a suitable COTS tool, so we developed our own.’

What was your experience in using your own in-house tool?
‘It worked well, but there were two major downsides: Firstly, keeping it updated with the latest technologies throughout the project became increasingly time consuming, and the total overall cost for this ended up being very high. Secondly, the tool had its limitations as it didn’t offer integrated risk analysis.’

When it came to choosing a risk management solution for the Fehmarnbelt Link, what were your main considerations?
‘We wanted a solution th Fehmarnbelt tunnel project description

at offered a risk management database and integrated Monte Carlo simulation for cost and schedule analysis.

We also wanted a simple, project-focused solution as we knew that interface and usability for ordinary risk owners were essential to successful risk management. We put it out to tender, and chose Risk Decisions’ Predict! risk management software, as it met our criteria. It also worked out costing approximately one-third of the total cost to build the in-house tool for the Malmö City Tunnel Project. Why develop it yourself if you can find it on the shelf?’

What are your top tips for project managers facing the ‘Make Versus Buy’ dilemma?

1. Ensure you have a good overview of cost: direct and indirect costs must be considered. The direct costs are those of making or acquiring the product, and the indirect costs are the support costs for the product. Cost can really add up over the duration of a project if you need to support your own tool. With a COTS tool, the cost is more predictable from the outset.

2. Functionality requirements can evolve during the lifetime of a project. COTS tools often have additional functionality built in that can be switched on as needed.

3. Get your senior management involved from the start. If management is involved, on-side and supports use of the tool throughout the organisation from the start, this will set you up for project success.

Risk Tools Make v Buy: Main Considerations