Project Management Risks
Project Management Risks
Introduction
Scantel Project is a development of vision metrology, a devise which could optically scan a product at some point in the manufacturing process, and check the accuracy of up to twenty individual dimensions. The said project will help the production process in identifying the defective products that will result in the increase of output. The said project was forwarded to the Development Director Bob Brierly to lead the team in managing the project. Since this project involves a large amount of money, Brian Callister was assigned by Bob Brierly to investigate. Callister was given a three month deadline to report to the VIL board. Like other projects the Scantel project may have some risks involve on it. The purpose of this paper is to identify the risks that may cause delay on the completion of the project. Upon identifying it the paper will suggest on what strategy will be used to be able to overcome the risks. This will be a step by step analysis to evaluate clearly the risks that might happen along the way.
At the end of the paper a conclusion will be presented showing the possible success of this project. The Scantel projects consist of a five major sub-systems: Lens and lens mounting; Vission support system; Display system; Control Logic System, and Chassis and body. The analysis will be done on the five major systems.
The Scantel Project
Identifying Risk
Risk identification determines what might happen that could affect the objectives of the project, and how those things might happen. The identification should be comprehensive, as risks that are not identified at an earlier time may threaten the success of the project and cause unpleasant result. The process should be structured using the key elements to examine risks systematically. The identification can be done thru brainstorming, since it is the most effective and flexible way of identifying risk. The needed information in identifying the risk includes historical data, theoretical analysis, empirical data and analysis, informed opinions of the project team and other experts and the concerns of stakeholder.
In the Scantel Project the diagram is presented in two ways; the full Scantel Network Diagram (Appendixt1) and the Simplified Network Diagram (Appendix 2). The event listings involve the step by step event that will guide the team in planning. A project manager will ensure the success of a project by minimizing risk throughout the lifetime of the project. One of the biggest problems teams face in risk management is their desire to be very precise in their probability estimates. But, because most probabilities are subjective, precision need not extend to the fifth decimal place. It is the facilitator's role to ensure that the team does not spend an excessive amount of time fine-tuning probability estimates. (Merrit, Smith, 2003). Probability risk needs to be assessed. The initial step in assessing the probable risk is to identify the possible risk. In Scantel Project the risks were identified in the five
sub system: The lens, Vision support system, the control logic, Chassis and body and the display system.
Based on the investigation they have done they were able to evaluate which among the sub-systems are on risk. The probability can be assessed by determining which among the risk will be highly risky that it will clearly affect the project. As what the investigation show among the 5 sub system the most critical event are the Lens. This sub-system involves events 5-38-43-44 (refer to Appendix 1). This is said to be critical because of the complex shape and a degree of curvature of no more than 0.0005 on the projected image that would be permissible if the system was to perform up to its intended design specification. The time frame is affected because the production of lens required high tolerance and it will undergo into a trial and error approach in the manufacture. The exact time to manufacture would be uncertain. Since the diagram shows dependency, it would be impossible to complete the project if they were not able to resolve the problem about the manufacture of lens. Financial costing would also be a risk, since this will be done in trial and error procedure the company should prepared the needed amount for this to avoid further delay in the manufacture.
The Control Logic may also cause delay in the project. This system represents the most complex electronics design and software engineering task, and proves to be the most difficult to plan and estimate.
The chassis and the body sub systems includes event 37-42. This part of the project is about the mechanical layout and the internal wiring within the body of the equipment so that all other units would be properly connected. The major uncertainty involved in the design of this unit was the timely receipt of data concerning the other units in the system.
The last sub system is the Display system which may or may not have risk at all. The only uncertainty was likely the delivery time. Using the Common risk Checking the risks were identify which may cause delay in the completion of the project. In Brian Callister view dependencies may also affect the outcome of the project. According to Callister's analysis the main tasks associated with each sub-system were separated into their engineering, testing and rework phrases. This shows that the package was relatively independent but in fact the rework or engineering are strongly dependent upon the amount and quality of prior engineering. This would probably cost the project a lot as well as time consuming and therefore affect the time and cost of completion of the Scantel Project.
A project should be handled by a good leader. A good leadership and a well budgeted project will be the key in the success of the Scantel Project. But base in the estimation done by George Hudson, the head of Instrument Development the cost would be higher than the company's existing products. The objective of the project is to build a three prototype Scantel systems to be “up and running”. The Scantel posed several problems that involved the engineers and the staff involved.
This may affect the outcome of the project. A conflict on the engineers working on the instrument and the optic sides may cause delays on the operation. The optical engineers think and feel that the instrument engineers are arrogant. The instrument engineers feel that the optical engineers are craft centred rather than science centred. These two groups of engineers do not have the expertise in this kind of project for they are both young and new. And the other problem is the crucial deadline for the first batch of prototypes meant that some activities might have been accelerated, an expensive process which would need careful judgement.
Based on the above facts and analysis we may say that the Scantel Project needs to have a strategic action to be able to mitigate the risk or prevent the risk from delaying the project.
Potential Risk Treatment
The purpose of risk treatment is to determine what will be done in response to the risks that have been identified, in order to reduce the overall risk exposure. Unless action is taken, the risk identification and assessment process has been wasted. Risk treatment converts the earlier analyses into substantive actions to reduce risks.
Once risks have been identified and assessed, all techniques to manage the risk fall into one or more of these four major categories: (Dorfman, 1997) Risk avoidance or elimination, Reduction or mitigation, Retention and Transfer. In the Scantel project elimination of the event that causing risk would be impossible since the entire event presented are important. A reduction on the risk will be the best treatment. In the Lens production problem it would be helpful to add days as well as budget on the said event. To perfect the needed Lens it needs to undergo a trial and error process and is therefore needed more time and money to perfect it. It would also help if the company will hire someone who specializes in doing such project to lessen the time. The Project Team should focus on events that are dependent in the production of Lens. A delay on this would mean lost in money and the objective of finishing the project on time would be impossible. The strategy should be able to have an event that is less dependent on the production on lens. The Project manager should be able to assess the situation and be able to come up on something to prevent the risk.
The control logic subsystem and the body and chassis risk maybe resolve by collecting the data on time. Control logic system is said to be the most difficult part of the project the company should hire someone who are experienced enough in doing such project. The Scantel has hired someone which are young software engineer with a little experience about the work will not help the company to finish the project on time. But the engineer was confident enough that the technical problems will be resolve even though the system needs were novel, but the completion time will be difficult to obtain.
One of the important risks that need to be resolved is the conflict between the two departments that are working in the project. Engineers are the main character in this project for the project requires technical works. If conflict between two departments continues how can the project become successful? One thing that needs to be done is to sit down and brainstorm. The idea or suggestions of the Optical department can be helpful in the instrument engineers. The project leader should be the one handling the problems of the two departments. Both are essential in delivering the project success.
The financial capability of the company needs to be assessed. Some of the event in the projects requires bigger budget. Budget should be supported by documents as well as computation why such amount is needed. The company should be able to provide excess amount to those project that requires a trial and error process such as in the production of lens. The compensation for the engineers involved in the project as well as the salaries for the staff should be very well assessed to avoid the possibility that someone might complaint about their compensation that will result in the delay of the project. The company should be very careful in releasing such fund to avoid overspending that may result in the breakdown of the company's financial status. A professional help is needed in this part since it is one of the strength of the company. The company is very well financed and a failure of the project would result in the loss of the company.
Conclusion
Scantel Project is a very expensive project which may or may not benefit the company. The company's purpose is to be able to develop three prototype of the Scantel System. The following steps are important in managing the Scantel Project: Identifying risk, analyse the risk, evaluate the risk, and treat the risks. An effective strategy and approach is important to avoid, reduce and mitigate risks. In the case of the Scantel Project, it may succeed and completed on the projected time as long as the team will be able to identify properly the risks involved. Communication and consultation with project stakeholders may be a critical factor in undertaking good risk management and achieving project outcomes that are broadly accepted.
Risk analysis can be done quantitatively or qualitative depending on the project involve. Qualitative process is useful in Scantel project, once the risk is identified the involve personnel in the project can do the analyses of the risk and later on the treatment of the risk. The risk involve can be treated by removal, reduction, avoidance, transfer, and acceptance. A good leadership will also bring the Scantel Project to success. The number of companies practising Project Risk Analysis and Management is continuing to increase due to the fact that the methods, techniques and processes involved form an integral part of project and business management.
Bibliography
Smith, Guy, Merrit, Preston, (2003) Evaluating risk: undertaking new ventures need not include unexpected losses. By systematically evaluating possible problems at the beginning of a new project, nasty surprises can be kept at bay.(risk management ).
The Basics of Project Risk Management, Part 1; Chapter 1 Page 11, 2004
http://media.wiley.com/product_data/excerpt/17/04700228/0470022817.pdf
Norris, Perry, Simon ( 2000) Project Risk Analysis, The Association for Project Management.
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