Can the “VUCA Meter” Augment the Traditional Project Risk Identification Process? A Case Study

Thordur Vikingur Fridgeirsson, Helgi Thor Ingason, Svana Helen Björnsdottir and Agnes Yr Gunnarsdottir
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Thordur Vikingur Fridgeirsson: School of Engineering, Reykjavik University, Menntavegur 1, 101 Reykjavik, Iceland
Helgi Thor Ingason: School of Engineering, Reykjavik University, Menntavegur 1, 101 Reykjavik, Iceland
Svana Helen Björnsdottir: School of Engineering, Reykjavik University, Menntavegur 1, 101 Reykjavik, Iceland
Agnes Yr Gunnarsdottir: School of Engineering, Reykjavik University, Menntavegur 1, 101 Reykjavik, Iceland

Sustainability, 2021, vol. 13, issue 22, 1-13

Abstract: In this rapidly changing and fast-growing world, sustainability is an important paradigm. However, the constantly growing level of uncertainty leads to increased strain in decision making. This results in a growing need for a more effective and extensive approach for identifying project risk in particular events that are not easily detected but can have a severe impact, sometimes referred to as Black Swans or “fat tail” events. The VUCA meter is a normative approach to identify project risk by assessing in a structured way events that may be volatile, uncertain, complex, and ambiguous and might contribute to the project risk. In this study, the VUCA meter is benchmarked against a traditional risk identification process as recommended by PMI ® . Firstly, two workshops, each referring to the respective risk identification method, were conducted. Secondly, a Delphi survey was run to investigate if the VUCA meter would capture Black Swan risk events that are bypassed by the traditional risk identification approach. The results clearly indicate that the VUCA meter can be developed to be a significant addition to the conventional risk identification process for large projects that are at an early stage. The VUCA meter facilitates a discussion that gets people to think beyond the traditional framework for identifying project risk factors. As a consequence, “fat tail” events, that are not apprehended with the conventional technique, are captured by the VUCA meter.

Keywords: project management; risk management; risk identification; risk assessment; VUCA (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2021
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