FTA Oversight Procedures - Federal Transit Administration - U.S. ...

Management Plan; these recommendations shall be developed in accordance with the following,
and shall be organized appropriately by Risk Type, Mitigation Structure and Mitigation Type as
described below.
6.6.1.1 Risk Types
Risk recommendations associated with Risk Events shall be classified as technical, schedule or cost
risk, or some combination thereof.
Technical Risk is performance risk that is manageable by the Grantee and its consultants and
contractors; unresolved technical risk may threaten the planned schedule and/or budget. For
example, construction‐phase technical risk events may include those associated with the
uncertainty surrounding mobilization of a tunnel boring machine and its planned production rates.
If output, reliability, availability, etc. do not meet plan, the variance may impact schedule or cost.
Failure to successfully mitigate such technical risk within the technical risk mitigation framework
can, in short measure, exceed the ability of the project schedule to absorb the impact. If the
schedule mitigation fails, the cost mitigation framework is stressed in turn to absorb the impact of
added production costs and schedule delays that it may or may not be able to contain.
Schedule Risk is fundamentally risk to the project schedule and may additionally threaten the
project budget. Delays to the project critical path will directly delay the project, and significant
reductions to schedule float will reduce the ability of the project to withstand schedule change.
Failure to successfully mitigate such schedule risk can, in short measure, exceed the ability of the
project schedule to absorb the impact of delay. If the schedule mitigation fails, the cost mitigation
framework is stressed in turn to absorb the impact of schedule delays that it may or may be able to
contain.
Not all schedule risk is driven by technical risk, but all technical risk drives schedule risk.
Cost Risk is fundamentally about risk to the project budget. Risk events associated with cost risk
may additionally threaten the planned schedule.
6.6.1.2 Mitigation Structure
Mitigation structure refers to varying levels by which the Grantee and its consultants and
contractors may respond to the risk events and assessed risk levels identified through prior
products of this OP‐40. This structure consists of three parts: Primary Mitigation, Secondary
Mitigation, and Tertiary Mitigation.
Primary Mitigation occurs throughout the various project phases and is the result of the planned
actions of the Grantee and its consultants and contractors as described in the Risk Management
Plan portion of the Project Management Plan, as supplemented with the PMOC’s recommendations
resulting from this OP‐40. Such activities are scheduled at the earliest phase during which the
mitigation activity may occur, and are expected to be completed on a timely basis to achieve the
cost‐risk parameter targets at the end of that phase, as developed in 6.2.2. Examples of scheduled
mitigation might be completing design, or a geotechnical survey, etc.
Secondary Mitigation consists of pre‐planned, potential scope or process changes that may be
triggered when risk events occur that exceed certain phase‐based targets, described further below.
OP 40 Risk Assessment and Mitigation Review
Revision 0, June 2008
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