Managing Project Risk

Managing Project Risk

Introduction

Managing project risk is one of the hardest parts of any project. It has been compared to a field of landmines in which one wrong step can stop you in your tracts. In developing a project that needs to be planned out in advance, a project manager should take into account those stumbling blocks which could inevitably cause delays or increased costs, is a must. Although in any project there are a number of risks that can develop during the project, the top five specific risks should be considered. In the simulation on the University of Phoenix site entitled “Managing Project Risk”, the five specific risks found were; resource constraints, skill and competency gaps, dependency on FAFS for design inputs, availability of network equipment, and legacy systems and standard law.

Resource Constraints

In any project there are several kinds of resource constraints including; people, materials, equipment, and working capital to name a few (Gray & Larson, 2005, p. 244). In our simulation it was materials and people were the resources that were discussed. The people in our scenario are only part time and are not experts at what they do. Training is the one thing that will be needed to make the team a success. The younger generations today have not been taught how important real work is to success (Goldsmith, M. 2008). The probability that scheduling the part time people assigned to the project might become a problem was medium to high and that it would cause the impact on the project’s budget and completion date to be high which in turn would place the chance of failure, or exposure, at a medium threat.

One of the mitigation strategies might be assigning additional resources: reschedule critical activities based on availability of part-time personnel. Arrange for regular team meetings with project sponsors. In the event of a change in management plan, then some of those team members could be released and resources diverted to other areas with some of the less skilled work being outsourced.

Skill and Competency Gaps

The probability that this could affect the completion of the project would be high if this problem were not planned for. Without proper training and instructions, the impact on the project would be medium risk. This would cause a delay. But, because the training involved would be planned for in advance, and seeking those individuals to work on the team who are actively looking for development opportunities, to work on those competencies that they have not managed to fully leverage as of yet, could delay the finish date. An executive's time is valuable. Investing that time wisely in the right development experiences can deliver great value to the individual and the organization (Geaddert & Moret, 2007). This time for training would only cause a medium exposure of failure for the project.

Dependency on FAFS for Design Inputs

The experts at FAFS gave input as to possible bottlenecks that could result in having to reschedule activities resulting in delays, this was given a probability of low to medium chance of occurring and if it were to happen, it would mean an impact of very high on the project. The rescheduling of project activities in conjunction with part-time resources could be a major impact. Although, the exposure to failure of the total project would be relatively low. To mitigate this risk, meeting with FAFS experts and involving Viviane in meetings had been suggested. But, more importantly is the regular scheduled meetings with project sponsors.

Availability of Network Equipment

In this section, the network equipment not being available when needed would be a medium probability of happening because those scheduling the resources would be keeping track of the available times and dates. But, if it were to occur, it would mean a delay in scheduling which could be considered a medium impact on the project. This would mean a ripple effect in the delay of finishing the project but only having a low exposure rating toward project failure. The mitigation technique that could be used for this scenario could be to install a tracking system, such as those being created today to use the internet to place a project online and allow experts from all over the world in that chosen field to comment on the projects other risks that may not be evident to the experts on hand (Scanlon , J., 2007). Another method would be to create a Change Control Board to evaluate cost increases, and allocate a reserve equivalent to the expected cost increase.

Legacy Systems and Standards

This specific risk relates to the use of old software and creating