Homework #6
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Industrial Engineering
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Dec 6, 2023
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Uploaded by MasterSquirrel1666
Stevens Institute of Technology
School of Systems and Enterprises
Castle Point on Hudson
Hoboken, NJ 07030
EM 612
Project Management of Complex Systems
Homework #6
Problem 1: Classic Case: de Havilland’s Falling Comet
Read the case study and answer the question sat the end of the case. The case study is in a
separate pdf file posted on canvas.
Question 1: How could risk management have aided in the development of the Comet?
The aircraft produced by the company was progressive and creative in ways that may have led to
being threatened by shift in technology. The original design of the Comet had revolutionary
elements and features like square windows, pressurized cabin that led to the growth of the firm.
The launch of a new aircraft with innovative features without appropriate testing resulted in a
disaster. The project also had complicated schedules with changing situations.
Risk management in the development of the Comet would have aided in the evaluation of
control related to several events and possibility of failure. It would have helped in the
development of useful techniques and frameworks for systematic implementation. Risk
management would have highlighted any possible technical and design failures that would have
helped the organization to mitigate them.
Question 2: Discuss the various types of risk (technical, financial, commercial,etc) in relation to
the Comet. Develop a qualitative risk matrix for these risk factors and assess them in terms of
probability and consequences.
Technical risk:
The Comet possessed technical risk after the technology it used for manufacturing the
aircraft failed to assure passengers and crew of their safety.
The design of large windows was discovered to be the reason behind the fatalities
involving Comet.
The design of the large windows was a reason to cause stress crack to form in the corners
due to rapid pressurization, as well as cabin depressurization.
Testing demonstrated that the wings of the aircraft have low resistance to fatigue.
Probability of Technical risk:
Maturity (0.7)
Complexity (0.7)
Dependency (0.9)
Consequence Severity Effect:
Cost (0.7)
Schedule (0.5)
Reliability (0.7)
Performance (0.7)
Financial risk:
The technology that was used in developing the Comet was the reason the organization
suffered financial risk.
The new technology was expensive for the organization to fund and many interested
buyers were placing orders for the new aircraft.
Probability of Financial Risk:
Maturity (0.5)
Complexity (0.7)
Dependency (0.7)
Consequence severity effect:
Cost (0.9)
Schedule (0.7)
Reliability (0.5)
Performance (0.7)
Commercial risk:
Developing Comet by De Havilland was for revolutionizing the aircraft industry.
Comet was the first aircraft commercial jet and the organization wanted to be the
standard in the business.
One of the Comet exploded 6 minutes after take-off killing all 43 passengers on board.
Probability of Commercial Risk:
Maturity (0.5)
Complexity (0.7)
Dependency (0.7)
Consequence severity effect:
Cost (0.7)
Schedule (0.7)
Reliability (0.9)
Performance (0.9)
Question 3: Given that a modified version of the Comet (the Comet IV) was used until recently
by the British government as an antisubmarine warfare aircraft, it is clear that the design flaws
could have been corrected, given enough time, What, then, do you see as de Havilland’s critical
error in the development of the Comet?
Time and design were significant errors during the development of the Comet. Boeing was a
leading competitor for the Comet that made de Havilland to move at a faster pace for launching
the aircraft. The organization wanted to set new standards for jet aircrafts. So, they rushed
through the entire testing process of the aircraft while overlooking the safety requirements. The
engineers on board wanted to deliver a product that captures the market irrespective of the
quality standards.
DeHavilland wanted to earn more money and become a pioneer for launching the new
generation aircraft. Engineers overlooked the aircraft design, and the quality was not good due to
the speedy construction process. The result of the poor aircraft design was baneful causing
accidents and loss of life before its halt.
Question 4: Comment on the statement: ‘Failure is the price we pay for technological
advancement.’
Comet by DeHavilland was the first organization to make the commercial jet aircraft, the lesson
that was learned was design and technical testing is a priority to prevent accidents. Failure of the
Comet resulted from non-adherence to technological advancement and design along with
inadequate testing and lack of risk management.
Innovation is essential but increasing the pace and overlooking the critical aspects of the building
process is not a solution. At the time when innovation was pushed beyond a limit one could have
stopped it and no one should have allowed for it to go as far as it did. Technological
advancement without proper risk management will eventually lead to failure.
Problem 2: Quantitative Risk Assessment.
Assume the following information:
Probability
of
Failure
Consequences of
Failure
Maturity = .3
Cost = .1
Complexity = .3
Schedule = .7
Dependency = .5
Performance = .5
Calculate the Overall risk factor for this project. Would you assess this level of risk as low,
moderate, or high? Why?
Overall probability (P
t
) = 0.3+0.3+0.5 / 3
= 0.366
Overall consequences of failure (C
t
) = 0.1+0.7+0.5 / 4
= 0.325
Risk Factor = P
t +
C
t
- (P
t
) (C
t
)
= (0.366 + 0.325) – (0.366 * 0.325)
= 0.691 – 0.118
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= 0.573
Since the risk factor is 0.573, the overall risk factor for the project is Moderate.
Problem 3: Developing Risk Mitigation Strategies.
Assume that you are a project team member for a highly complex project based on a new
technology that has never been directly proven in the marketplace. Further, you require the
services of several subcontractors to complete the design and development of this project.
Because you are facing severe penalties in the event the project is late to market, your boss has
asked you and your project team to develop risk mitigation strategies to minimize your
company’s exposure. Discuss the types of risk that you are likely to encounter. How should your
company deal with them (accept them, share them, transfer them, or minimize them)? Justify
your answers.
Making risk management a part of the project is important for the success of the project. When a
project is taken up, a company can make faulty approaches. The first step in a project is to identify
risks that can be encountered during the project. Identifying risks requires an open mind that will
focus on the future and scenarios that can happen. It is imperative that the project communicates
about the risks to formulate mitigation strategies.
As few risks have a higher impact than the others, it is best to prioritize the ones with the biggest
losses. It is best to check for roadblocks in the schedule that can derail the project. A risk matrix
can be used for risk assessment to define the different levels of risk. This matrix can enhance the
visibility of risks and assist in decision making.
The kinds of risks that will be encountered by the company are:
1. Financial risk: The company can encounter financial problems as the project is complex.
Complex projects usually encounter unaccounted risks and can become very expensive for the
company. The company is facing several penalties for the project being late to the market. These
risks can be minimized by performing a cost analysis during the planning phase of the project.
Employing
2. Market risk: As the company is working on a new technology that has not yet proven in the
market, it is risky and can encounter problems no one can anticipate. New technologies often take a
huge amount of time and money to setup as well. This risk can be mitigated by creating a work
breakdown structure and responsibility assessment matrix and making it assessable to everyone
working on the project. Daily standup meetings can be used to communicate the progress of the
project and get everyone’s perspective on how to mitigate market risks.
3. Technology risk: With new technology hitting the market, it can either result in a huge success or
a failure with numerous issues. The glitches or issues in new technology need to be accepted and
rectify them for the same issue to not occur again.
4. Competition risk: Since the company is attempting to introduce a new technology, once it is
launched the competitors can take an advantage and create similar products and enter the
marketplace. It is imperative for the company to patent the technology that will be used in the
project.
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