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Risk, Uncertainty, and Trouble: Escaping the RUT of Program Instability

Risk Track

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When we say we are stuck in a rut, we imply our often repeated actions are forced on us by things outside our control. As if to say, we are not really as crazy as we look. But what if we build our own rut and then act as if we have no choice?

Risk and uncertainty are not what get us into trouble. We get into trouble when we ignore, or unwisely discount, risk and uncertainty. I call that Risk, Uncertainty, and Trouble—and it is a RUT of our own making.

Making Assumptions
Financial instability is a problem. Budgets are tight, the pace of operations is high, and changes pop up against requirements. We back away from clearly expressing measures of risk and uncertainty that are subjective by their very nature. Like it or not, the system drives us towards a point estimate. Time and time again, that is what gets us into trouble.

Embracing the Full Picture
One reason we shy away from fully explaining risk and uncertainty is that they are perceived as bad news. If we are to avoid the RUT of program instability, we must accurately describe the uncertainty and risk a program faces. That is how we will gain the smooth traction of high-confidence acquisition programs.

For example, if we develop a plan to solve a technical problem and give ourselves a reasonable time to accomplish the task, we tend to discount the risk involved in actually solving the problem.

When we minimize risk and uncertainty to approving officials, they make biased decisions based on “optimistic assumptions” (our current euphemism for poor judgment).

Getting into Trouble
Because of the amount of risk and uncertainty inherent in a weapons system development program, the amount of extra money needed to go from a 50 percent confidence that the program will not exceed a certain cost to a higher confidence level is often unaffordable.

Keeping an Eye on the Customer
Sometimes we have good reasons for rushing things to the field. It is a disservice to our leadership to think they won’t accept the risks if we communicate them and let them debate whether the potential benefits are worth it—or not.

Accept and Control, Not Escape
Failing to admit that things may not proceed exactly according to plan is a recipe for trouble. Many things in our business are unknown and will stay unknown until we attempt to execute a program. Adding money to the top line of an effort that is not fully understood is prohibitively expensive. It is a disservice to present a decision maker with an estimate for a new groundbreaking weapon system that claims the system can be developed for a certain price and that the confidence can go from 50 percent to 80 percent confidence with only a 3 percent or a 6 percent increase in funding. And it is foolhardy for a decision maker to accept that estimate.


Colonel Brian Shimel
Colonel Brian Shimel is Director, Financial Management, Electronic Systems Center (ESC), Hanscom Air Force Base, Massachusetts. As the Center’s chief financial officer, Colonel Shimel is responsible for the oversight of more than $4 billion of the Air Force’s budget. He provides interpretation, resource allocation and technical guidance to support the ESC strategic goals. Colonel Shimel entered the Air Force in 1984 as an AFROTC Distinguished Graduate, from the University of Vermont. After assignments at Sheppard AFB, TX, Spangdahlem AB, Federal Republic of Germany, and the USAF Academy, CO, He moved, in 1992, to Wright-Patterson AFB, OH, to attend the Air Force Institute of Technology, as a graduate student, where he earned a Masters in Cost Analysis. He served at Los Angeles AFB, CA, Space and Missile Systems Center, HQ Air Force, Washington, D.C., Secretariat of the Air Force for Cost and Econometrics, and at the AF Cost Analysis Agency as a Senior Weapon Systems Cost Analyst. In 2000, Lt Colonel Shimel was assigned to Cannon AFB, NM, as the 27th Comptroller Squadron Commander. In 2002, Lt Col Shimel was assigned to the Strategic Command and Control System Program Office, Electronic Systems Center, Peterson AFB, CO, as the Chief of Financial Management. In 2004, he was selected to command the 21st Comptroller Squadron, Peterson AFB, CO, serving from June 2004 to July 2005. He reported to the Pentagon in July 2005, as the Military Assistant to the Auditor General of the Air Force, where he served until August 2006. He was then assigned to the Air Force Cost Analysis Agency, Washington, D.C., Secretariat of the Air Force for Cost and Econometrics, as Deputy Division Chief, Program Integration, until July 2007 when he assumed his current position.