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Risk Management at Astaldi (Part Two)

In this second post, my goal is to give readers an overview of the evolutionary process involved in establishing a risk management culture at Astaldi and the role CCH Tagetik plays.

Astaldi’s risk management journey spans several years. We began the initiative in 2010, and now, seven years later, we continue to fine-tune the practices and activities involved.

 

Risk Management at Astaldi


Astaldi’s Enterprise Risk Management System (ERM) is the result of close teamwork with CCH Tagetik and Protiviti, a specialist in risk management consulting. Before delving into the technology aspect of the project, we worked with Protiviti in 2010 and early 2011 to establish the project’s foundation – work that included the development of a common risk management language, the identification of typical potential risks for our business, the mapping of risk management processes, and the development of risk-related policies and procedures.

By the end of 2011, we launched a pilot project based on a select number of risk categories identified as potential threats to Astaldi’s objectives and strategies, along with appropriate measurements and potential risk responses.

The success of the pilot project paved the way for the full-scale development of our risk management system, powered by CCH Tagetik. This work, conducted over 2012 to 2013, integrated risk monitoring and early warning analysis into existing CCH Tagetik strategic and operative planning processes. We also designed the actual system interface, created the report package, and uploaded actual data. System functionality was also tested with select projects.

By 2014, we were ready to roll out the new risk management system. In advance, we developed user support materials documenting the risk analysis methodology as well as the new system. Over the next two years, we then conducted local workshops and did on-the-job training in order to reinforce the risk management methodologies. We also conducted “risk back” analysis to better understand historical strengths and weaknesses of past projects in order to refine risk prevention processes and improve overall contingency planning.

Today, Astaldi’s ERM system is an end-to-end system supporting all risk-related activities – from data collection to reporting -- at three different levels: project, country and enterprise. Key features include:

 

  • Risk analysis data collection
  • Monte Carlo simulation and related reporting
  • Risk-adjusted financial forecast reporting based on CPM data
  • A “sandbox” to conduct specific risk analysis activities and simulations, mainly at the project level
  • Structured workflows with alerts and progress indicators, used primarily at the enterprise level

 

We have also designated a system administrator who has visibility over all processes, data collections, simulation executions, and reporting.

Currently, Astaldi has approximately 150 projects in progress – spanning large-scale infrastructure initiatives (such as highways, railways, and bridges) to hospitals, airports, and dams. Approximately 80% of these are now being tracked in our risk management system. Projects are formally evaluated every six and twelve months and more frequently assessed at the local level. Astaldi’s senior management team and board of directors receive a very detailed report package quarterly.

The creation of a risk management culture is an ongoing process. Some still find it hard to accept. But, in most cases, people are embracing the fact that, having a structured methodology to manage risks is bringing high added value to any initiative. As a result, we are a better, smarter, and more agile business.

 

Do you want to understand why it's important to consider risk as an integral part of the business? See my previous blog!


RISK MANAGEMENT AT ASTALDI (PART one)

 

 

Risk Management at Astaldi

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