Managing Risk by Reordering Tasks in Engineering Design

Abstract

Abstract This paper describes a model of how reordering tasks in the engineering design and development process affects resource usage in a risky environment. All development projects are risky; their outcome and level of success is unpredictable. Many projects are canceled at some time during the development process, or never produce a working product or produce a product that fails in the marketplace. Doing engineering development is expensive; it requires high-cost labor as well as other potentially expensive resources. To some extent the magnitude of the risk is estimable; it is possible to predict now much resources (time, labor or other costs) any particular development task will consume as well as some estimate of whether or not an insurmountable technical problem is likely to be discovered. Also, development tasks are not independent; there are constraints on their ordering due to needed technical knowledge. The model presented in this paper uses those estimates to suggest an ordering of the tasks in an attempt to minimize the expected resource consumption for those projects that run a risk of cancellation.