System of Systems Framework for Structured Risk Analysis in Complex Engineering Projects Involving Alliance
In today’s rapidly evolving technological landscape, complex engineering projects often involve multiple stakeholders, dynamic alliances, and interacting systems that are interdependent yet operate under mutual goals and constraints as a cohesive system. The alliance-driven complex engineering projects aim to distribute technical responsibilities, risks, uncertainties, resource requirements, and financial burdens across multiple organizations. While beneficial in many perspectives, alliances introduce unique layers of technical, relational, and operational complexities. Inter organizational dependencies, intricate systems integrations and stakeholder’s interactions exacerbate the risk profile of projects. Complex engineering projects such as aircraft manufacturing, submarines developments, mega construction projects, and expensive manufacturing plant upgrades exemplify the challenges and intricacies faced by alliance-driven projects. These alliance complex engineering projects are the form of socio-technical system of systems (SOS), relying on interacting tightly interwoven subsystems including structural, operational, mechanical electrical, and software. Conventional risk management frameworks do not account unpredictable behaviour of SOS where interactions among multiple systems multiply risks.
The project's success demands seamless integration of highly specialized systems such as mechanical, electrical, digital, and socio-technical that function interdependently with varying resources, project parameters, objectives, and risk tolerance among multiple organizations. Conventional risk management methods are insufficient for capturing and analysing the high degree of interactions and interdependence among people, process, and product elements of systems, the operational success of each system is reliant on the performance and stability of other interacting elements, creating cascading dependencies and amplifying risks within SOS. The absence of an advanced integrated risk management framework to identify risks in interacting systems heightens the probability of project failures. Traditional risk assessment approaches focus on individual systems rather than the holistic SOS, often overlooking the emergent risks that only manifest due to interactions between multiple systems. These hidden risks can negatively impact project outcomes if not identified and managed early. Such complex projects demand a structured risk analysis framework that can accommodate dynamic interactions and multiple stakeholders. A specialized SOS framework is needed to capture these hidden risks, enabling proactive risk controls. These risks are only detectable through the system of systems approach as failure to model and manage these interdependencies can result in delays, cost overruns, and operational inefficiencies that compromise project success.
To address these pressing challenges the research aimed to establish an effective, logical, structured, and an easy-to-use framework that facilitates risk identification, categorization, and evaluation throughout the project life cycle. To do this, the research focused on constructing an advanced risk analysis model capable of mapping activities that could occur among fundamental system elements and visualizing the risks residing within these interconnected links, thereby enabling systematic risk assessment and proactive risk management. After a substantial search through literature and industry consultation, the research aimed to develop an integrated System of Systems (SOS) architecture for comprehensive risk analysis of complex engineering projects involving alliances and to establish a dedicated ontology knowledge base for supporting analysis of the SOS architecture. These objectives helped to define three research questions, each informed by a rigorous, methodological distinct approach to guide the research program in achieving research objectives.
The first research question explored the development of an integrated alliance system architecture. The first stage was the analysis of the enterprise and system modelling approaches for the selection of an appropriate system model for alliance modelling. Modelling of alliance SOS requires a system model that has structure and an understanding of the connections. After experimenting with several pre-existing enterprise architectures, the 3PE system model was applied as the base model. This model provided the fundamental elements of organizational segmentation, represented by the interaction of the 3Ps, Product, Process, and People within each participating system to achieve the project goal. The “E” element in the model was extended to represent the operating environment of an alliance system. The SOS characteristics could be modeled by developing interaction matrices among the 3PE partner models. This process has been formalized in this research as 3PESOS. The 3PESOS model constructed the integrated alliance system architecture through the association of 3PE interactions with alliance system architecture elements. The research found that for developing an integrated alliance system architecture for risk management that can manage risks effectively, an alliance system architecture needs to be established by examining its formation requirements, development processes, and alliance critical risks. NVivo is used for qualitative analysis to extract elements of alliance system architecture. This alliance architecture, models the essential structural and operational elements of complex projects, providing a clear pathway to track and mitigate risks across inter-organizational interactions of people, processes, and products.
The second research question addressed the identification and categorization of critical alliance complex engineering project risks, considering intricate interactions of the system of systems. A systematic literature review combined with system modelling and NVivo analysis is employed to develop the structured alliance risk ontology framework. This ontology categorizes risks by their nature of interactions within the alliance SOS context, serving as a foundational tool for risk analysis, and offering a standardized approach to categorize and prioritize risks. 3PESOS risk ontology is a knowledge asset that enables organizations to identify and capture interdependent risks stemming from the intricate interactions of people, processes, and products to achieve a project’s goals. The outcome of this research offered a risk ontology particularly applicable to alliance risk analysis. The study produces a comprehensive knowledge asset by synthesizing and organizing risk data within the framework. The research question has dual contributions for practitioners and researchers. For project managers and engineers, it's an effective tool for implementing a formal risk management methodology within complex interacting systems. For researchers, the study provides a starting point to explore the application of risk analysis framework for real-world case studies where systems of systems need to be managed.
The third research question is about how to enable industry practitioners to perform risk analysis on their alliance projects so that risks can be mitigated as early as possible. This research question investigates, if possible, designs, validates, and applies the 3PESOS as a risk assessment tool, grounded in the 3PESOS risk ontology framework. This tool quantifies the average risk impact of risks using the Likert scale approach, enabling a comparative analysis of six risk categories within the 3PESOS framework. By capturing quantitative data across risk subclasses, the 3PESOS tool allows engineers and project managers to assess and prioritize risk categories. The risk prioritization matrix and action plan of this tool enable focused mitigation efforts on high-risk impact areas. Empirical validation through a real-world industry case study proved the tool’s practical relevance, demonstrating its value as an effective tool for risk analysis in complex engineering projects.
This research project developed a structured system of systems risk analysis framework that significantly contributes to the body of knowledge on risk management in alliance complex engineering projects. The proposed Integrated Alliance System Architecture for risk management, the 3PESOS risk ontology framework, and the 3PESOS risk assessment tool offer a systematic approach to identify, categorize, quantify, and visualize risks across interactions in complex alliance engineering projects, thereby strengthening risk management strategies and enhancing project resilience. This research methodology and outcomes are adaptable to various engineering sectors, paving the way for improved risk management practices in complex engineering projects.
