The Economic Recovery and Growth Plan – A Project Risk Management Perspective

 By Robert Mbonu

The situation: After months of waiting, the federal government launched the four-year Economic Recovery and Growth Plan (ERGP). It is a strategic response to a recession in the second quarter of 2016 caused by the sharp and continuous decline in crude oil prices since mid-2014, along with a failure to diversify the sources of revenue and foreign exchange in the economy.

Previous economic policies left the country ill-prepared for the recent collapse of crude oil prices and production.

The ERGP, a Medium-Term Plan for 2017 – 2020, has been developed for restoring economic growth while leveraging the ingenuity and resilience of the Nigerian people – the nation’s most priceless assets.

The current administration recognised that the economy is likely to remain on a path of steady and steep decline if nothing is done to change the trajectory.

The ERGP differs from previous plans in several ways. Focused implementation is at the core of the delivery strategy of the Plan over the next four years. More than ever before, there is a strong political determination, commitment and will at the highest level. All the ministries, departments, and agencies of government will have their different roles in implementing the Plan. But most importantly, a Delivery Unit is being established in the Presidency to drive the implementation of key ERGP priorities. The success of this plan therefore rests on the management of the programme by this special Delivery Unit.

With professional project and risk management techniques, it is entirely possible to deliver huge projects such as the ERGP on time, on budget, and to the expected outcome. The root of the problem often derives from the lack of governance over such projects. Governance of a project is best delivered in a well-managed project risk management programme driven by someone who has the authority and experience to deliver the programme, and who can motivate, sanction and drive people to deliver the expected outcome for the stakeholders.

These are ten steps that need to be conducted by the Delivery Unit, using Project Risk Management techniques to deliver the benefits. Whilst the following looks like a list to be done each in turn, once one process is kicked off, then concurrently another should start, like the wheels on a car, except that there may be hundreds of wheels on such a complex project, in other words ‘begin the process again and continue it until a state of perfection is reached in which perfect value is created with no waste’;

COMMUNICATE: this is an ongoing process and seems obvious, but many project teams forget to be transparent about what they are doing and how the management of risk is progressing. Transparency and honesty in communications that are consistent and persistent will help to bring everyone onto the same hymn sheet and get everyone feeling as if they are a part of the same team. Use all means that are available and appoint a communications person who is dedicated to getting the messages out.

CONTEXT: Independently determine the project priorities – what’s most important to the stakeholders? A project’s success is normally determined on three things; budget, timing and delivering the expected quality of outcome.

IDENTIFY: Identify the risks using a wide range of inputs from all interested parties and ensure that even the grey areas are not left untouched. Understand the root causes of the issues and problems in the light of the objectives for the project.

Ensure that the identification stage continues through the programme and is a constant process – risks change as the project moves through its phases, and the commissioning phase has its own unique set of threats and opportunities. Make everyone responsible for risk identification and reward those who come up with ideas.

ANALYSE: For the ongoing risk management of this project it is useful to separate the certainties from the uncertainties and then to analyse the threats and opportunities in joint workshops – mixing teams together and getting them to take joint responsibility for ensuring the project is on track.

Again, the analysis is an ongoing process as new risks are identified and new causes/consequences are analysed.

EVALUATE: Prioritise the threats and opportunities with the joint teams so that there is a workable plan for each stage. Be clear about the timings for the threats and opportunities; one of the pitfalls is that at critical points of the project it is often the case that several things can go wrong at the same time, or opportunities can be missed.

OWNERSHIP: Define responsibilities and ensure clear goals for each risk owner and risk control owner. These goals should include timing for delivering the control, accuracy, communications, involvement of others and resources. Get buy in and sign off from those involved by ensuring that everyone feels jointly motivated and involved.

CONTROL: Use the full gamut of control techniques for the risks using proactive controls for the causes of the risks, and reactive controls for the consequences.  Implement control strategies swiftly and run concurrent programmes, constantly analysing and improving the control processes and communicating the outputs in digestible ways to all partners in the programme.

MONITOR and MEASURE: You may at this stage require more than a series of spreadsheets to record, handle, and analyse all the data that has been generated. There are many generic risk management systems out there, and some are specifically geared to project risk management. An audit trail is also critical. Delivering believable and consistent management information is important to the ongoing belief in the programme and the incentivisation of the various players.

REVIEW: Look back and compare outputs with what was before. Make realistic comparisons that will enable people to learn and improve their own behaviour constantly throughout each phase of this project.

CELEBRATE: Yes, if you can do all of this consistently, concurrently and gain the proof that it all works, then a celebration is deserved. But also, everyone who participated in the programme needs to be rewarded appropriately because they will be seasoned project risk practitioners for the next time!

With these ten steps, a framework can be designed for a complex project such as the ERGP. This will ensure each phase is brought on track and successfully delivered. Therefore, to be fully effective, risk management must be closely integrated into the overall ERGP project management process. With the right commitment and drivers, the ERGP can be achieved.

• Mbonu, FERP, CIRM(UK), HCIB, MsRM (Stern), studied Engineering, is an experienced Banker and Enterprise Risk Management professional. Earned a post graduate degree in Risk Management from New York University Stern School of Business, and is a member of the Institute of Risk Management -UK. Can be reached on 09092092046 (SMS Only); email: rm4riskmgt@gmail.com