Project Risk Management
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Rutgers University *
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Course
390
Subject
Information Systems
Date
Dec 6, 2023
Type
Pages
4
Uploaded by helloru
Rachel Azarian
Project Risk Management
November 16, 2022
Alexis Hernandez
Matthew Marrazzo
Tiffany Xu
Runal Baldota
Risk Sensitivity Analysis
The Design Review stage often has the largest schedule impact on the end date
of the project as it’s the phase which immediately follows the Concept Review phase.
As such, there are multiple rounds of testing between engineering subject matter
experts as well as other personnel which need to occur in order to finalize the design of
the project. Furthermore, the Design Review phase has the longest average delay, at
approximately six weeks long. This is due to the number of revisions which may need to
be made in order to accommodate requirement changes that need to be made
throughout the entirety of the project. The Design Review phase also typically includes
assessing the design and the Concept Review, having multiple different discussions
regarding the design with different stakeholders and members of the team. Members of
the project may also provide feedback regarding the design, which include, but are not
limited to: asking questions, posing challenges, as well as suggesting improvements to
the project design. Furthermore, during the Design Review, assessing the risks that are
potentially involved in the project is critical to the success of the design and project.
Therefore, it is important to implement preventative measures during the Design Review
phase in order to mitigate the amount of risk involved, by incorporating safety training,
simplifying processes, embedding error checking in setup form, as well as performing
multiple different types of audits and other improvement processes to reduce defects
and other issues down the line.
Mini Case Assessment
1. Was the document given to the sponsor a risk management plan?
The document was not a formal risk management plan as it missed all the elements that
are included in that kind of analysis. The basics approaches to risk management start
by identifying, assessing, developing a response , and monitoring risk. Based on the
narrative, the sponsor handed
the sponsor a WBS and a list of over 100 risk events
that lacked any kind of assessment.
2. Did the project manager actually perform effective risk management?
The PM claims that their team will not be assigning probabilities or damages until the
prototype reaches the late stages of development. This approach does not seem like it
will be effective because any kind of risk response might be of little effect when the
project reaches the final stretch. The PM also listed out over 100 risk events with no
actual thought on how they could effect the project. The sponsor points out that
resources were wasted compiling this list and this is true because none of them were
assigned any kind of risk score or ranked for priority. There is no factual basis for the
PM’s claim that these risk events will go away, let alone which ones in particular will
remain toward the end of the projects life cycle. Ultimately, there wasn’t any information
learned from the work that the PM conducted.
3. Was the appropriate amount of time and money spent identifying the risk
events?
The PM had some justification in identifying all the risk events associated with the
project. In addition, it doesn’t seem like they spent too much time compiling this list as
the sponsor claimed. One thing to question further is how much this endeavor cost the
team. The PM believes that because they haven’t conducted any risk management
procedures, costs should be less than 10 percent of the budget that was allocated for
risk identification. Since the PM compiled this list early on into the project, the amount of
time spent is minimal and the money used thus far will be made up when risk
management proceedings finally begin.
4. Should one step be allowed to “dominate” the entire risk management
process?
Project risk management is about identifying project risks and developing strategies to
prevent or minimize occurrence. In this scenario, the PM decided to compile a list of all
possible risks that could emerge from the progression of the project. Even though this is
a good first step, the PM has failed to assess any of these risks and determine any
course of action to address them as they plan to do it towards the end of the
development cycle. Risk management is an ongoing process throughout the life of the
project as there are many other components to this process. The PM’s single approach
has dominated the entirety of the process and will more than likely backfire when time
begins to tighten towards the end of the cycle.
5. Are there any significant benefits to the amount of work already done for risk
identification?
The existence of the list serves as a great benefit for the project team as it provides the
total outlook of all the obstacles the project might face. Even though assessment has
not started yet, the PM can look through the items and begin to explore responses for
each one. Identification took place early, and thus gives the PM plenty of time to work
on the rest of their risk management plan.
6. Should the 100 or so risk events identified have been categorized? If so, how?
To properly analyze and comprehend these risk events, there should be an established
methodology for categorization through heaping them together based on commonalities.
This can be done by implementing a Risk Breakdown Structure, a chart that utilizes a
hierarchical architecture for defining primary categories that then branch off into
subcategories to efficiently organize and classify identified risks within the project
(Hillson, 2002).
By orchestrating the risk events in this manner, it is possible to furnish
structured documentation that is readily understandable to assist in the recognition of
recurring themes and project areas with high exposure.
7. Can probabilities of occurrence and expected outcomes (i.e., damage) be
accurately assigned to 100 risk events?
Although seemingly tedious, it is possible to accurately assign probabilities of
occurrence and expected outcomes to these 100 risk events through the utilization of a
risk assessment matrix.
This qualitative risk analysis tool assists in the visualization of
information regarding the likelihood of an event occurring along with the potential impact
that a risk event may have on the project or organization (Audit Board, 2021).
After
these potential issues are examined in this manner, it is then feasible to prioritize based
upon the designated critically by the probability of each risk materializing and the
magnitude of distribution that may be caused.
8. Should a project management methodology provide guidance for the
development of a risk management plan?
When attempting to institute any particular project management methodology, guidance
should certainly be provided in regards to the development of a risk management plan.
As a means for identifying and evaluating potential mishaps, the risk management plan
is an essential process that dictates ideal plans if these issues were to occur within the
project lifecycle, ensuring that the appropriate course of action be taken if necessary.
Therefore, being such a critical aspect that could determine the success of initiatives,
the project management methodology should provide such a guideline that establishes
and standardizes the procedures for utilizing this tool to guarantee information
surrounding the project risk is being properly analyzed and discussed.
9. Given the life cycle phases in the case study, in which phase would it be
appropriate to identify the risk management plan?
Based on the life cycle phases that are being implemented by the organization, the risk
management plan should be identified during the preliminary planning in order to begin
discussions involving potential project risk as early as possible.
As it is possible to incur
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risk at any stage, these procedures regarding the identification and management of
such issues should be considered an aspect of each step within the project and
thoroughly conducted for the entire duration (National Research Council of the National
Academies, 2005).
For the methodology being used for this particular project, this
would allow ample time for the project sponsor and stakeholders to discuss these risks
during the phase review meetings.
10. What are your feelings on the project manager’s comments that he must wait
until the prototyping phase to assign probabilities and outcomes?
The project manager’s comments about needing to wait until the prototyping phase to
assign probabilities and outcomes makes sense because this would allow for further
information to be gathered about these risk events.
By establishing a demonstrated
experience with the process that will be implemented for development, a more acutely
accurate assessment can be made about the possibility of such expected risks actually
occurring along with the extent to which the project may be impacted.
References
Audit Board. (2021, March 18). What is a Risk Assessment Matrix? And Why Is It
Important?. Audit Board. Retrieved from
https://www.auditboard.com/blog/what-is-a-risk-assessment-matrix/
Hillson, D. (2002, October 3). Use a risk breakdown structure (RBS) to understand your
risks. Project Management Institute. Retrieved from
https://www.pmi.org/learning/library/risk-breakdown-structure-understand-risks-1042
National Research Council of the National Academies. (2005). The Owner’s Role in
Project Risk Management. National Academies Press. Retrieved from
https://nap.nationalacademies.org/read/11183/chapter/6