Managing Project Risks as Knowledge Gaps

Abstract

The development of new technologies and the implementation of such technologies in new applications is a continuous effort to close technological and logistical knowledge gaps. Although knowledge gapscan be closed by accident—like the case of Archimedes who closed an important knowledge gap about the laws of nature while bathing—in most cases, knowledge gaps are closed by a consistent, organized effort, namely by projects. Project management methodologies attempt to manage the risk generated by the one-time nature of projects. This risk is generated by the lack of knowledge and its resulting uncertainty. Tools for managing project risks and their consequences, including risk identification, risk quantification, risk elimination, risk reduction, risk sharing, and risk control, were developed and are implemented to some degree in many technological projects. However, most of these tools are based on statistical theory (e.g., the central limit theorem). Unfortunately, statistical theory may not be applicable to technological projects where there is very little or no relevant previous experience at all. The question is: what can we do when past data is not an appropriate basis for future decisions? In this paper we describe a new approach for dealing with technological projects—an approach based on the analysis of knowledge gaps (i.e., the gap between what we should know in order to succeed in the project and what we really know).