Tetra Tech EC and Risk Management

This document is authorized for use in educational programs at the Antai College of Economics & Management, Shanghai Jiao
Tong Univ until May 8, 2019.

S w
9B07M044
TETRA TECH EC AND RISK MANAGEMENT
Donna Fletcher and Susan Newell wrote this case solely to provide material for class discussion. The authors do not intend to
illustrate either effective or ineffective handling of a managerial situation. The authors may have disguised certain names and other
identifying information to protect confidentiality.
Ivey Management Services prohibits any form of reproduction, storage or transmittal without its written permission. Reproduction of
Use outside these parameters is a copyright violation.

this material is not covered under authorization by any reproduction rights organization. To order copies or request permission to
reproduce materials, contact Ivey Publishing, Ivey Management Services, c/o Richard Ivey School of Business, The University of
Western Ontario, London, Ontario, Canada, N6A 3K7; phone (519) 661-3208; fax (519) 661-3882; e-mail cases@ivey.uwo.ca.
Copyright © 2007, Ivey Management Services Version: (A) 2007-05-17
As Don Rogers, chief operating officer of the remediation firm Tetra Tech EC (Tt EC), left the meeting of
project managers, he reflected on the risk management process he had championed over the last 10 years.
Had he gone too far, or not far enough to enhance the company’s strategy? He wondered whether the
process was too rigid since it limited innovation, or whether the risk management discipline required by the
process was the reason for the strides in safety and efficiency that had proven profitable to the firm.
COMPANY BACKGROUND
The Electric Bond and Share Company (EBASCO) was founded by Thomas Edison in the early 20th
century. Since 1978, it had been owned by ENSERCH Corp. (ENSERCH), an expanding energy company,
which had grown out of a local distribution gas pipeline company, or LDC, in Dallas, Texas. In 1992,
EBASCO found itself facing increased exposure risks on several Superfund remediation projects, which
involved cleaning up environmental pollution, including toxic, hazardous or nuclear waste. Prior to 1992,
the Superfund projects had been protected from third-party risk for exposure to such hazards through
indemnification by the Environmental Protection Agency (EPA). However, the EPA was in the process of
removing its indemnification for remediation projects. This change would expose companies, including
EBASCO, to increased risk in this work.
Several large engineering companies, such as EBASCO, had moved into remediation work because both
the federal government and many U.S. states were concerned about cleaning up the environment and had
invested resources, either through fiscal policy (i.e. taxes) or by regulating commercial enterprises to
ensure that they reduced their negative impact on the environment. These actions created a context in
which the remediation market grew rapidly, with fairly low barriers to entry. Large companies with
engineering and construction competence, such as EBASCO and Bechtel, were very interested in entering
this market since it was seen to be potentially very lucrative. Yet, the problem with remediation was that it
dealt largely with subsurface contamination: you don’t really know what you’ve got until you start digging.
Such unexpected conditions created economic risk since cleaning up an area could be more costly than
anticipated and contracted for, exposing a company to potentially heavy losses on a project. In 1992, this
This document is authorized for use in educational programs at the Antai College of Economics & Management, Shanghai Jiao Tong Univ until May 8, 2019.
Page 2 9B07M044
was the case for EBASCO, when there were two large remediation projects that were either losing money
or about to lose money:
• In the Bridgeport Remedial Oil Services (BROS) Superfund project in southern New Jersey, the
contractor was indemnified for claims of injury or loss to third parties related to environmental
pollution. This project involved cleaning up a 500-acre (202-hectare) waste-oil pit site where the
owner (a farmer) had accepted, knowingly or otherwise, all kinds of hazardous waste onto his
property, which now needed to be remediated.
• The environmental group at EBASCO had taken on the Times Beach project, a $110-million
commercial remediation project, but senior management was very concerned about the potential risk.
Times Beach was founded on a flood plain along the Meramec River in 1925, during a promotion in
which the now defunct St. Louis Star-Times newspaper gave away properties along the river as part of
its subscription drive. A purchase of a 20×100 foot (6×30 meter) lot for $67.50 included a six-month
newspaper subscription. In 1971, plagued with a dust problem, due to its 23 miles (37 kilometers) of

dirt roads and lack of pavement funds, the city of Times Beach hired a waste hauler to oil the roads in
the town. From 1972 to 1976, this hauler sprayed waste oil on the roads at a cost of six cents per gallon
used. The roads were then paved. Polychlorinated biphenyls (PCBs) were subsequently found in the
Times Beach soil, and EBASCO was hired to remediate.
EBASCO was facing the possibility of losing tens of millions of dollars on the BROS Superfund project;
the Times Beach project was in its infancy, but was assessed by senior management as having a high
potential to lose money. EBASCO realized that it needed to develop a process that would protect its assets
in such an uncertain and risky business. EBASCO hired Don Rogers, the former head of EBASCO
Development Co., to develop a remediation group and manage these projects. His approach, which evolved
gradually, involved management of, rather than avoidance of, risk: take on risk if you can identify it
correctly, ensure the proper operational controls are in place, hire competent people to execute the controls
and implement a verification process to ensure that the plan you defined is being executed faithfully.
At the time, EBASCO had an environmental remediation consulting division within EBASCO Services,
Inc. and a construction company, which operated as two independent profit centers. Since it took both
entities working together to complete the remediation work, Rogers requested that he be made an officer of
both companies — senior vice-president of Remediation and Construction. The company also instituted a
regulatory compliance program. A regulatory manager1 was assigned to develop this program. At the same
time, personnel changes were made in the safety program.
During this period, EBASCO was sold to Raytheon. However, since Raytheon did not want to take on the
risk associated with such environmental projects, ENSERCH retained the two groups under Rogers and
formed ENSERCH Environmental Corp., with the rest of EBASCO being sold to Raytheon. ENSERCH
Environmental Corp. lasted about 18 months and, in the end, thanks to the success of the compliance,
safety and risk management programs, was doing about $140 million worth of business annually. Despite
this success, ENSERCH decided to focus on gas exploration and distribution, and sold ENSERCH
Environmental Corp. to Foster Wheeler in October 1994. Foster Wheeler had a small environmental group
(with revenues of approximately $60 million per year), which eventually merged processes with
ENSERCH Environmental Corp. and became Foster Wheeler Environmental Corp. At that point, Rogers
1
Denise Drace-Brownell, J.D., M.P.H., manager of Regulatory Affairs, EBASCO Environmental, and later vice-president of
Regulatory Affairs, ENSERCH Environmental, was the first regulatory manager. She was an accomplished lawyer and
business executive. The program designed by Drace-Brownell met all the legal guidelines of that time and would also be in
compliance with today’s U.S. Sentencing Guidelines.
Page 3 9B07M044
became executive vice-president and chief operating officer (COO) of Foster Wheeler Environmental
Corp.
Foster Wheeler Environmental Corp. emerged as a successful company. The management and staff of
Foster Wheeler Environmental Corp. attributed a significant part of its success to the risk management and
compliance programs. At one point, the head of human resources (HR) at Foster Wheeler approached Don
Rogers regarding his training programs, but was overwhelmed by their comprehensiveness. The program
appeared to be “too big of a deal,” and Foster Wheeler decided not to adopt it company-wide. In March
2003, Foster Wheeler sold the assets of Foster Wheeler Environmental Corp. to Tetra Tech (Tt) for $80
million. Tetra Tech renamed the company Tetra Tech EC (Tt EC), one of approximately 20 different
companies owned by Tetra Tech. (See Exhibit 1 for the chronology of these events.)
THE EVOLUTION OF THE RISK MANAGEMENT AND COMPLIANCE PROCESS

The elemental steps of the risk management and compliance process that Rogers proposed to ENSERCH
in 1993/94 was referred to as the Task Initiation Procedure or TIP. At its core, the TIP was as simple as
understanding the project, identifying the risks and defining the risk management plan for each risk. Since
its earliest inception in 1993, the process included a focus on risks associated with five broad areas and the
management of the identified risks to be included in 11 planning elements. The five broad areas were
1. site conditions,
2. technical performance and how the process of performance and the outcome affect the site,
3. stakeholder issues,
4. regulatory issues, and
5. contract issues.
The 11 planning elements were

1. the work plan,
2. the quality assurance/quality control plan,
3. the staffing plan,
4. the cost/schedule control plan,
5. the communication plan,
6. the health and safety plan,
7. the status and monitoring plan,
8. the risk management plan,
9. the documentation plan,
10. the cash management plan, and
11. the regulatory compliance plan.
The approach required the project manager to consider these issues, which focused on identifying the risks
associated with the project being planned.
Once the risk management plan was prepared and approved, the appropriate operational controls for each
identified risk were included, as appropriate, in one or more of the 11 planning elements listed above. The
plan was reviewed by specialists and experts, and approval was needed before the project would be
allowed to move forward. The final stage was to execute the project exactly as it was planned, with any
need to deviate from the plan leading back in an iterative way to re-planning the project. The mantra in the
company was “We like to say we plan our work and work our plan.” After projects were up and running,
they were regularly reviewed to ensure that the plans were actually being followed.
Page 4 9B07M044
The purpose of the Task Initiation Procedure (TIP) was to identify potential risks on a project and develop
quality objectives and measures, and operational controls and/or mitigations for these risks in a risk
management plan. Through this process, environmental aspects that required conformance with the
Environmental Management System (EMS) were identified, as were design characteristics that required a
technical sponsor to ensure that experts approved work that could be technically complicated. Resource
specialists, discipline leads, task previewers and TIP approvers were all involved in the process.
The TIP review process began long before a bid was actually placed on a potential contract (see Exhibit 2).
Clients typically provided information on a contract approximately six months or more in advance of the
request for proposal (RFP) release. At this time, Tt EC would begin the TIP process. Based on the client’s
scope, Tt EC evaluated the risks and communicated this assessment to the client. This information helped
the client to be more precise about expectations when it actually issued the RFP. This early negotiation
also enabled Tt EC to sell its approach to the client, in hopes of ensuring the client would be more
appreciative of Tt EC’s approach and view of the project risks.

Tt EC’s approach meant that business from new clients that were not familiar with this process was often
difficult to secure; although Tt EC was competitive, it was not typically the low-cost bidder. However, Tt
EC had more than 90 per cent repeat business because the companies that worked with Tt EC found that Tt
EC was able to deliver on its projects consistently, whereas other companies were not able to deliver as
consistently, possibly because they had failed to identify the risks upfront. On most if not all the projects
that Tt EC had lost for not being the low-cost bidder, the issues of concern that Tt EC had identified in the
TIP process became real problems for the winning company. For example, on one particular project, Tt EC
proposed to excavate and then de-water material before the water was taken off in trucks and disposed of.
The competitor’s bid was much cheaper because it had proposed pumping the material that Tt EC claimed
was not pumpable. The lower priced contractor won the bid. However, the competitor subsequently found
that the material could indeed not be pumped, as Tt EC had predicted. The lower priced contractor could
not accomplish the work as intended and, as a result, got in deep trouble on the project. The client turned to
Tt EC to complete the project. This example illustrates how the Tt EC approach to risk management
created a higher barrier for Tt EC in winning bids, but nevertheless led to a situation where contracting
companies learned to trust Tt EC precisely because of its risk management approach.
Given the comprehensiveness of this risk management approach, there was a steep learning curve for new
Tt EC employees, even those who were very experienced in remediation work. However, once employees
understood the TIP and the associated risk management approach, they were able to work on any project
because “Tt EC does everything the same way.”
TT EC’S APPROACH TO RISK MANAGEMENT
Tt EC adopted an approach to risk management that was different from most companies. For most
companies, a “risk appetite” decision occurred even before a risk assessment, when the company identified
the level and kind of risk it was prepared to take and then assessed whether or not an RFP met its criteria.
If the risks were higher than its appetite, the company would not bid for a contract. However, at Tt EC, the
mantra was that “there is absolutely no risk we can’t deal with,” even though the company had a very
limited risk appetite. Tt EC was therefore able to take on any risk because the TIP process ensured that a
high-risk activity would be converted to a low-risk activity through the planning process and by
implementing operational controls that would cope with any problems that might emerge.
Page 5 9B07M044
There were two aspects to the risk management approach adopted by Tt EC. First, it assessed up-front and
tried to both anticipate the risks and identify solutions that would overcome or mitigate those risks.
Second, its bid included a very tight specification of the activities it proposed and included a statement to
the effect of
We don’t know what is going to happen once we start digging, and our bid is based on the
assumptions we have defined in detail in our offer. If these assumptions hold then we will
go with this price. But if they don’t hold then the scope is different than we have bid, and
we will start renegotiating.
In other words, Tt EC mitigated risk by being precise in its bid about what it would do to complete the
work at a site, and stated that if it found conditions that were not anticipated and were therefore unable to
complete what it had stated in the bid, then the additional work would be the basis for renegotiating the
contract.

Thus, a fundamental aspect of the TIP and risk management approach was that projects were stopped when
the plan could not be followed. The initial TIP stages meant that a comprehensive plan was necessarily
developed. However, every time something unexpected occurred, that aspect of the project was required to
be stopped in order to involve the necessary expertise involved. The project then needed to be re-planned
before starting again. Employees were told that, “In the end, it will cost the client and the firm more to
continue than if you didn’t stop and restart.”
Stopping and restarting a project could put project managers behind schedule. Thus, many were tempted to
sweep problems under the carpet. To avoid this temptation, Tetra Tech EC followed a comprehensive
approach that began with the hiring process. In orientation training, new hires were taught that slower was
faster: if you don’t stop and re-plan, eventually you will have a problem that you did not plan for, and the
project will take infinitely longer. Also, the teachers/trainers were project managers who could point to
their personal experiences. Finally, people were held accountable for the decisions that they made and the
processes that they used to make them. Employees were told: “You would be in more trouble with us if
you didn’t stop and plan and made the target than if you did stop and plan and didn’t make the target.” This
philosophy was illustrated in a story that became a legend in the company, when there was a need to enter
a confined space that was not on the original plan. As told by Don Rogers:
Early in the game, we had a Navy project in the northwest. It included a confined space
entry. If you have to go into any confined space, a tunnel, a vessel, a ditch, you go through
a protocol, including testing the air and following a sign-off process. We had someone
who entered a confined space as a shortcut activity, without going through the protocol.
The person felt comfortable in the confined space, that it was not going to be hazardous,
expected to get in and out quickly, and in fact, accomplished it. He got in and out quickly
without a problem. We found out about it maybe four or five weeks after the event. The
supervisor was not on site at the time, but got wind of it and raised the flag. It turned out
that there was a safety person on the site, who allowed this individual to do that, and the
safety person had called the local office safety supervisor and told them they were going to
let him do it and the safety person supervisor there said okay. We fired the person who
entered the space; the safety person, who was on site and said it was okay was
reprimanded but not fired since he had sought management input; and the home office
person, who said it was okay was also fired. We didn’t fire the person who raised the flag.
Page 6 9B07M044
Tt EC had three different oversight processes to ensure that projects were working as planned. First, peer
reviews occurred during the execution of the work for each stage that resulted in a deliverable or
completed sub-project. The peer reviews referred back to the risk management plan to see the risks that
were identified and the operational controls that were supposed to be executed. The reviewers then
determined whether these controls were being executed. Every project was peer-reviewed by project
managers and discipline leads. Every discipline had peer-review rules. The disciplines wrote their own
quality peer-review requirements, which were consistent with regulatory requirements (e.g. 14001
certified). If there were a variation between the planned operational controls and the action that was
actually taken, it was considered perfectly acceptable, as long as the changes were documented, explained
and peer-reviewed before being implemented.
Tier two was project reviews. Every quarter, each project was reviewed by senior management. Which
projects were reviewed by executives and which were reviewed at the office level were determined by the
office manager. Projects in excess of $2 million, or high-risk projects, were reviewed by executives. Office

managers were also required to provide to the executives a sample of projects that were indicative of the
work in their office and for which the office manager would like executive input. There was a project
review protocol — a standard package prepared for the project review. In general, people looked forward
to these reviews. Tt EC did everything to make them a positive experience and bad news was treated
sensitively. The company’s philosophy was: “The primary responsibility of executives is to make sure that
the person who gives you that bad news leaves glad they brought you the problem.”
Further, project managers found that a quarterly review was not just an opportunity for the executives to
look at the projects and be comfortable that risks were being addressed and customers were being satisfied;
it was also an opportunity for the project to reach up to the company level and say, “I can’t execute this
part of my project efficiently because . . .” or “the IT system needs to be fixed” or “the procedure doesn’t
exist to do this” or “we haven’t been able to hire this staff.” Again the value of the project reviews was
illustrated in a story about a previous project as described by Rick Gleason, vice-president and a senior
program manager in the Boston office:
We had a situation three or four years ago on our New England project; we were just
gearing up into a very major part of work down at New Bedford Harbor, and we needed to
hire staff, and we needed some more emphasis on . . . I think we wanted to implement
some slightly different cost and schedule systems, and we actually scheduled a project
review and brought some extra people in and had the right discourse at the project review;
got approval from the right areas and support from the right areas to make some hiring, get
some IT [information technology] support, change some systems . . . and that’s really
when the project review works best. You get both the peer review, kind of that additional
layer of protection, but you also have the project reaching up to the corporate systems and
saying, “Here’s what we need to do our job better.”
The third level of review was the audits, which covered both quality and compliance. Projects needed to be
shown to be compliant with both the Federal Acquisition Regulations (FAR) and with internal Tt EC
systems and processes. The two audit groups coordinated schedules so that they each reviewed a project
once per year, on a semi-random basis.
The performance of projects bore testimony to the effectiveness of this rigorous TIP and risk management
approach — approximately 98 per cent of the company’s work in the last 10 years was completed either on
or ahead of schedule. The key to this track record was that the schedule changed when the company
Page 7 9B07M044
encountered a situation that it had not contracted with the client. Clients accepted this approach because
everyone in the remediation business was aware that no one really knows what is underground.
IMPLEMENTING THE TIP APPROACH
Don Rogers believed that the critical issue in remediation was managing engineers, construction workers
and scientists who tended to be anxious to “get on with it,” and therefore did not spend enough time in the
planning stages. The TIP was introduced to change this mindset. However, the comprehensiveness of the
TIP, made it initially difficult to implement, as recalled by a program manager in Boston:
When we first started these (TIPs) . . . about 1993 . . . those reviews were unpleasant events because you
had project people thinking that they had all the answers and “how dare these people who are both outside
the project and not even necessarily really technical people, who are asking questions that are almost more

from a layman’s perspective?” and “this is a waste of my time, and I’m doing it just because they’re
making me.”
However, it soon became clear that even naïve questions could promote a discussion that could help
identify a risk. The process had evolved so that the project managers generally thought through all the risks
while working through the TIP. As a result, after the project managers submitted their TIPs for review,
reviewers did not identify many risks that had not been anticipated by the project managers. The TIP on
complex projects was reviewed by a group of reviewers.
Moreover, not only were project managers providing more thorough TIP documents but the reviewers
were also more experienced so that they were less likely to ask “off-the-wall, layman’s questions.” Instead,
questions from reviewers were phrased more sympathetically: “I realize you may have covered this, but
can you explain it to me?” Reviews had, thus, evolved over 12 years from initially being viewed as
“nasty,” “contentious,” “unpleasant,” “no-value-added” procedures to a valuable part of the process that all
involved understood and accepted. It was the iterative and the give and take of discussions that appeared to
help, as explained by Jim Leonard, general counsel for Tt EC:
We used to have a TIP reviewer, who prided herself on knowing nothing about these
projects. And who asked “off the wall” questions. [She would] say “How are you going to
do that?” and if the project team didn’t answer pretty quickly then it was evident that they
hadn’t thought through how to do it. One example was a very simple job. There was an
old barge the Navy had docked at the end of a pier. There was old residual oil in it and the
Navy needed merely to get the oil out of the barge. The Navy’s proposed scope was, “very
simple, go get an oil truck, pump it out, take it away and dispose of it.” Our naïve
questioner asked “How do you know the pier is going to hold the truck after it is full of
oil?” The team could not answer the question and the reviewers made the project manager
go back and find out. And it turns out the pier wouldn’t hold the truck. It was an old pier.
So what is the solution? Run a hose out; don’t put the truck on the pier. If we had done
what the Navy had suggested, we could have lost the driver and truck with all that
hazardous oil in it. It is one of the things that the process does for you. It makes us the
least-cost provider [even though our bid may be higher].
In order to ensure that each project was following the Tt EC brand of risk management, extensive training
and access to corporate procedures were required of all employees. The corporate office provided
corporate training at three levels: Project Management (PM) 100-, 200- and 300-level courses. The PM
Page 8 9B07M044
100-level course was previously a four-hour in-person module, but had evolved to an online format — an
initial quick indoctrination into what projects were about. The PM 200-level course was a multiple-day
course; two two-day weekends that covered the Tt EC “work process.” It included a substantial
compendium of training manuals and lectures and hands-on exercises and quiz material. The PM 300-level
course was actually beyond the work process; it focused on advanced issues associated with covering
baseline cost- and schedule-management and how to deal with change and notification of change to the
client.
EMERGENT ASPECTS OF THE TIP AND RISK MANAGEMENT APPROACH
The risk management approach suggested considerable importance was placed on compliance with
regulations, both internal and external. However, over the years, management at Tt EC had found that too
much regulation, whether imposed or self-imposed, could stifle innovation and interfere with the ability to

satisfy the client. Thus, several years ago, the set of online corporate procedures threatened to overwhelm
the company. Project managers felt that there were too many procedures, and since project managers were
held first and foremost responsible for compliance, there was just too much for anybody to digest and
retain for easy recall. As recalled by Rick Gleason:
For example, our task initiation procedure at the time, and still is for the largest projects,
was about a 40-page checklist . . . literally a checklist of technology questions, “does your
project include such-and-such? if yes, have you done this?” The idea being, as you work
your way through that checklist you’ll come up with, “is there a risk associated with this
issue, and if so, what am I going to do about it?” It used to be for every project you had to
sort of work your way through about a 40-page document, and even though it was a
checklist and it might have only taken about an hour to go through it, for a small project,
people felt like, “this is not relevant; not only do I have to fill out the checklist in an hour,
but there’s probably two or three other hours spent . . . I have to send it off for a review,
and then I have to incorporate comments, and then we have to get a legal person and a
technical person to come review and approve it, and by the time I’m all done, my one hour
turned into a four- or five-hour effort, and my overall project is only a week long,” or
whatever. So now, there are three or four slightly different permutations, down to the
simplest one, which is a page or two of material that you look through; you fill it out, and
if you’re a small fisheries consulting project in the Seattle office, the person who reviews
it is the office manager who has oversight of this project. It used to be everything had to
go up to a V.P.-level for review and approval. Now, that particular project is literally a
page or two, and the review is done locally by the office manager, and off you go.
Tt EC recognized the complexity of the process that it had developed and set up working parties to look at
simplifying it. This exercise led to procedures being categorized by discipline. Project managers then had a
specific set of about 10 to 12 procedures that guided them in terms of the must-know, must retain
information, as did the engineers, scientists and all other disciplines. Moreover, while the most complex
projects involved all of the planning elements; for simpler projects, the TIP process has been simplified so
that a “project planner” could be used as a simple checklist.
The culture had therefore been nurtured, which encouraged people on projects to identify where the
regulations were stifling the ability to conduct the necessary work — “You have an obligation to raise your
hand and say if I do it the way you are making me do it, it is not going to be optimal. Everything is about
continuous improvement.” In other words, the approach recognized that regulations needed to be
Page 9 9B07M044
continuously updated and responsive to changing circumstances. The TIP (and all the other procedures at
Tt EC) therefore included a button on the online form that allowed the person preparing the documentation
to write an email to the compliance department, which said “I need this variance from this procedure.” This
statement was reviewed and could lead either to the project being allowed to vary from the established
procedure or to a change in the procedure, where the procedure was considered to be problematic more
generally, or to include a “better idea”:
It’s through that constant challenge that makes it relevant, that makes the system work.
That is really the heart of the issue. You have got to be willing to say, you know what,
filling out this form doesn’t make any sense. You have got to be able to say the emperor
has no clothes; otherwise, it doesn’t work.
The biggest difference between the process in place in 2006 and the process followed initially in the early
1990s was in terms of ownership. Initially, the process belonged to the COO who was trying to get people

to follow the process. In 2006, the process belonged to the employees and they changed it all the time. For
example, during a recent project review out of the Philadelphia office, a detailed discussion ensued about
the forecasts and budget models on the website. Attendees admitted that many project managers (including
some of the discussants) did not use the model on the website for their forecasts, using self-created
spreadsheets instead because they found it difficult to import and export information on the website
models. Since the website was scheduled for a revision, the project managers wanted to get their remarks
heard and decided as a part of the review to hold a brown bag lunch the following month at the
Philadelphia office on the use of the website for project managers. The result was that a decision was made
to change the website models.
LESSONS-LEARNED METHODOLOGY
Employee moral was high at Tt EC. Employees believed that compliance with the company’s risk
management plan and regulatory mandates mattered to the company’s success and was rewarded. Human
nature was for the “incident person” to cover up, but Tt EC required this person to report it. “You can’t
succeed if the person who identified a problem to you is sorry that he did. You don’t know (and therefore
can’t rectify) what nobody tells you.” The importance of reporting incidents was stressed:
We had a terrible compliance violation that hurt the company very badly. It was a really
important lesson for me because one of my basic assumptions has always been — where
you have two people you have safety. One person might break the rules, but with a buddy
there, this is less likely. This was a team of five people. The team was working on
removing unexploded ordinance from a site. It was Thursday before a 4th of July
weekend, a long weekend and they were supposed to complete a removal of unexploded
ordnance before the weekend began. If you find an unexploded ordnance, there is a
protocol you have to use to destroy it. You build a protective facility. If it’s not clearly
marked that there is no fuse on the unit, you have to treat it as if there is a fuse and
explosive in it. They found not one but many of these things that are not marked and
realized that they would not be able to complete the job. What they should have done, of
course, is follow our rule: stop, re-plan, tell the client we found some new ones and will
have to do this again next week, even though we are supposed to be finished this week.
Instead, they moved this ordnance to a place 100 or so yards away, which would be
cleared in the future. What they did when they did that was they moved a piece of material
that is regulated by the range rule. They picked it up and moved it and it became
Page 10 9B07M044
potentially RCRA [Resource Conservation and Recovery Act] waste. Where they put it
down became potentially an unlicensed RCRA landfill. The five of them conspired to do
this. The least experienced person had more than 20 years as a UXO [unexploded
ordnance] specialist in the armed services. In the armed services what they did would have
been commonplace. They didn’t know whether they would do the area they placed this
stuff in next or not, but they knew it was going to be done and they knew there were no
explosives in the materials that were moved. This is in a secure place, protected from the
public area. The public can’t get into this place. So as far as they were concerned, they did
not create a danger. However, they broke serious regulatory rules. Six or eight weeks later,
a disgruntled employee blew the whistle. The employee called the state department of
environmental management and brought the state people to that ordinance and showed
them that the material had been moved. We would have fired all five immediately, but
they quit as soon as the event became known. We lost some projects because of this
incident because we had a black eye and it cost us about $1.5 million to remedy the

problem. What we had to do was go out and survey every piece of work we had done
before because the regulatory agency had to assume — and not unreasonable of them —
that this team had done it before. We investigated, of course to determine why this
happened; to figure out the lesson learned. One of the five people turned in the other four,
so there were some personal dynamics involved in that process. Candidly, we didn’t learn
a lot about it. It was probably as simple as it sounds. They wanted to get home to their
families. These guys were working 60-hour weeks. It was the last day before a long
weekend. They just wanted to get it done. They thought that they knew enough to be
certain they were not causing a hazard. I think if they had known what they were doing
from a regulatory perspective, they probably wouldn’t have done it. They didn’t know
there was a whole set of other regulatory criteria that had to be met. One of the corrective
lessons we took is we now teach those regulatory requirements in the field. We used to
just put them in the work plan. Now we teach them to those who will execute the plan.
Given this background, the company introduced incentives to report incidents and near misses, ranging
from electronic, formal accolades to t-shirts to spot bonuses. Incident reports were based on a concept from
loss control in safety management. Perturbations that arose on the job were reported, and a root cause basis
for the perturbation was determined. The incident reports ranged from very simple zero incident
performance (ZIP) slips, which were provided online to extensive investigative tools. The ZIP slip was
used when there was something that was minor enough that it really didn’t merit a major investigation, but
Tt EC wanted to make note of it (see Exhibit 3). The idea for the ZIP slip came out of a lesson learned
from a Rocky Mountain Project.
The person who was involved in the incident did the investigation under the supervision of the technical
supervisor. To ensure reporting and to ease the paper-work burden, the supervisor aided in filling out the
forms, evoking the lesson from the process and documentation. Management continually reminded
employees to “look for near misses; report near misses.” The rule of thumb was that an incident report
should be made every 3000 hours: if not, management assumed that it was not being advised of something.
Incident reports were required documentation in project review protocols.
These incident reports were then circulated to other people/projects that would benefit from the knowledge.
The supervisor, the quality person and the safety person would make a decision about who owned this
incident, from a technical perspective, called procedure owners. The discipline lead determined who could
benefit from this lesson and got that lesson to those people, either through e-mails or bulletins (called ZIP
bulletins). The system of checks and balances — supervisory chain and discipline lead chain — was
Page 11 9B07M044
designed to avoid forgetting incidents. Should the manager forget the lesson learned the discipline lead
would likely not forget.
Some of these lessons ended up changing work plans and/or procedures. Every two or three days, targeted
staff received an email notice from the administrator saying “Procedure Changed.” This usually meant
several procedures had been changed, resulting from either an incident report or a variance request. It was
Lotus Notes based. “We take the old one out and put the new one in. Quite a few companies describe
these kind of things in their project management and knowledge management processes, but…to do it is
rare.”
Lessons learned were proactively distributed by program managers who oversaw several projects. Program
managers may have spotted things that were worthy of being disseminated throughout the organization as a
part of its oversight process. Because program managers were overseeing multiple projects, there was an
ability to disseminate those lessons learned within the sphere of influence of the individual at the next

level. And because they were listening to all of the projects across the country and they were looking for
those things that were working well, they were disseminating that information as they moved around the
country. Sometimes the lessons learned were written, and sometimes they were just discussed in the
course of having a review of a project. They would say, “You know, on the Rocky Mountain Arsenal
project, our folks are doing this and such,” and often they would prompt a write-up on that from the project
that they had heard about. Then they would broadcast that information across the company. An example
was provided by Rick Gleason:
About two or three months ago, I guess it was, the senior vice-president of Remediation,
had sought out from the group of us, in advance of the teleconference, the things that we
felt were happening under our programs that were sort of safety “best practices.” So, there
were probably 10 to 12 of us on the call; each of us within the domain of our individual
programs went in and took a look at what we were doing within those programs that we
thought were a little bit unique, a little bit different, and then, during the course of that
phone call — we each had about two or three minutes to lay out — we actually gave him
an email in advance — what we were doing. One of the things that came out was a
remediation project in Corpus Christi, Texas dealing with a fair bit of work in and around
a wetland. It appeared that Hurricane Rita looked like it was going to come ashore in the
Corpus Christi area. The team did not have time to return the equipment before the storm
hit, so they arranged the equipment around the site to be most protective of the materials
and supplies. The proactive nature of what they did became a lesson learned and so, the
VP asked them to write it up, and then he disseminated that to the group of his key
program/project managers. Not that we’re necessarily going to have the same experience
with the same type of a weather event . . . but the kind of pro-activity is really the lesson
learned, of what kinds of things you need to think about and implement before the event,
not after the event.
A few years ago, we probably would have made the mistake of saying “the contingency
plan will include the following fifteen things and will specify the following fourteen things
. . . .” We’ve moved more towards the direction of “the minimum requirement is that you
must have a contingency plan.” We stop short of saying “you must specifically include in
your plan what you’re going to do with your equipment and where you’re going to put it,”
the idea being “think about all these things, but put a plan together that makes sense for
you.”
Page 12 9B07M044
Ideally, lessons learned become evolutionary by disseminating them and/or writing them and incorporating
them into the work process. Yet, there is a corporate memory that is also important because it is just not
possible to read 200 Lessons Learned reports and see what is relevant for a particular project. “We
recognized that if you put certain things into lessons learned in writing, they become like everything else
these days: discoverable.”

Page 13 9B07M044
Exhibit 1
TIMELINE OF EVOLUTION OF TETRA TECH EC
1978 1992 1993 2003

ENSEARCH buys EBASCO Don Rogers Sr VP ENSERCH Environment Corp formed Tetra Tech buys Foster Wheeler Env.
EBASCO from Remediation and Construction renamed Tetra Tech EC
Remediation and Construction
________________________________________________________________________
1992 1993 1994 Oct.
EBASCO takes on Raytheon buys EBASCO Foster Wheeler buys
two remediation projects (but not Remediation ENSERCH Environmental
& Construction) renamed Foster Wheeler Environmental
Don Rogers named COO

Exhibit 2
SCHEMATIC OF TASK INITIATION PROCEDURE
Source: Tetra Tech EC PO-2Task Initiation Procedure (TIP), p. 4.

Page 14
Source: Tetra Tech EC.

ZIP SLIP
Exhibit 3
9B07M044

Tetra Tech EC and Risk Management

Transféré par

Informations du document

Copyright

Formats disponibles

Partager ce document

Partager ou intégrer le document

Options de partage

Avez-vous trouvé ce document utile ?

Ce contenu est-il inapproprié ?

Droits d'auteur :

Formats disponibles

Tetra Tech EC and Risk Management

Transféré par

Droits d'auteur :

Formats disponibles

This document is authorized for use in educational programs at the Antai College of Economics & Management, Shanghai Jiao

Tong Univ until May 8, 2019.

TETRA TECH EC AND RISK MANAGEMENT

Use outside these parameters is a copyright violation.

Copyright © 2007, Ivey Management Services Version: (A) 2007-05-17

Use outside these parameters is a copyright violation.

THE EVOLUTION OF THE RISK MANAGEMENT AND COMPLIANCE PROCESS

Use outside these parameters is a copyright violation.

The 11 planning elements were

Use outside these parameters is a copyright violation.

TT EC’S APPROACH TO RISK MANAGEMENT

Use outside these parameters is a copyright violation.

Use outside these parameters is a copyright violation.

IMPLEMENTING THE TIP APPROACH

Use outside these parameters is a copyright violation.

EMERGENT ASPECTS OF THE TIP AND RISK MANAGEMENT APPROACH

Use outside these parameters is a copyright violation.

Use outside these parameters is a copyright violation.

Use outside these parameters is a copyright violation.

Use outside these parameters is a copyright violation.

Use outside these parameters is a copyright violation.

TIMELINE OF EVOLUTION OF TETRA TECH EC

1978 1992 1993 2003

Use outside these parameters is a copyright violation.

SCHEMATIC OF TASK INITIATION PROCEDURE

Source: Tetra Tech EC PO-2Task Initiation Procedure (TIP), p. 4.

Source: Tetra Tech EC.

Vous aimerez peut-être aussi