Guest blog from David Emanuel, Active Risk Account Director, US Government.
I saw a great presentation by Karen Richey, Senior Cost Analyst at the U.S. GAO (Government Accountability Office), who discussed GAO recommendations from their recent report on best practices for managing capital projects. (Report GAO-12-120G)
With the end of the government fiscal year still in sight; the continuing forecasts for tighter federal budgets; and the realization that federal government agencies must learn to deliver results with less funding, the GAO recognizes how important it is for federal agencies to develop reliable program schedules.
GAO cites a number of very good reasons and benefits for managing capital programs more effectively:
- Effective use of public funds
- Meeting OMB’s (Office of Management and Budget) capital programming process
- Avoiding cost overruns, missed deadlines, and performance shortfalls
- Combating unreliable estimates that cause many program failures
The comprehensive GAO report included a summary of audit findings for DHS, DOD, DOE, United Nations, Department of Veterans Affairs, Missile Defense Agency, and Federal Administrative Agency (FAA). Based on this wide ranging analysis, the overall message is clear. The government’s current ability to conduct schedule risk analysis is minimal at best. It is key that federal agencies must get better as this capability to effectively manage large programs and projects.
GAO’s top recommendation was:
- Conduct a cost risk analysis and a schedule risk analysis on ALL major programs and projects
Federal agencies are looking to do more with less. There is mounting pressure to maintain and improve delivery, while simultaneously reducing budgets. This really brings home the importance of understanding the risks associated with the health and successful completion of capital projects. This is the key to federal agency success in the future.
Find out more about the risk management challenges facing federal agencies in this insightful presentation from Dr. Doug Webster, President of AFERM (Association for Federal Enterprise Risk Management). This presentation was originally given as part of World Risk Day, 2012.
How are you meeting your federal risk management challenges?
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