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The Project Risk Management Methodology

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Question:

Discuss about The Project risk management methodology.

 

 

Answer:

Proposal and feasibility

An event is conducted based on the theme of “green cars”, in which the design is presented at exhibition of futuristic car designs. Six of the students of an academy wishes to create new green and budget electric car to start a new international business. In order to analyze if the project decision is feasible or not, SWOT analysis is conducted:

Strengths

Weaknesses

1.      The Entrepreneurial Management Academy can access to the new market with advantage over the competitors those are not focused on green electric cars.

2.      The Academy can charge premium on the products which are seen as eco friendly.

3.      Green marketing of the electric cars builds of brand equity and loyalty among the customers.

1.      Some of the team members have lack of knowledge on technical field

2.      There is weak marketing communication channel.

3.      There is low brand awareness about the electric cars.

Opportunities

Threats

1.      Low taxes are to be given for the eco-friendly cars.

2.      There are no charges for congestion.

3.      The marketing to segment those are becoming more environment friendly aware.

1. There are rapid changes into the customer preferences.

2. There is uncertainty if green marketing activities are to be acceptable from the government side.

3. There is an increase into cost of inputs.

From the SWOT analysis, it is analyzed that the project decision is feasible for the organization as it would adopt a green environment in the mind of people. The academy is characterized such an electric car which is environmental friendly. 

 

Plan (Schedule)

Statement of work (SoW)

The business needs a product development and launching of greencar which deliverables a pollution free car in the market. The period of time taken to conduct the work is 160 days, started from11st January and end date is 22nd August, 2018. The total budget of the project is $60,400. There is good employee and vendor relationship exists which is the main cause of successful completion of the work.

Specifications of the project

The specification of the project is based on development of Greencar. The environmental impact of the car is less pollution, renewable energy (recharge from solar energy), and manufactured using eco-friendly materials. The designing aspects are electric engine, braking system, motor controller, drive system.

 

Work breakdown structure

In table format, the WBS is:

WBS

Task Name

0

Greencar product development and launch

1

   Idea generation

1.1

      Identify the requirements of the customer

1.2

      Evaluate the quality of existing products

1.3

      Defining the objectives of new car

2

   Concept design

2.1

      Create idea generation

2.2

      Refine the concepts

3

   Feasibility study

3.1

      Check for the strategic feasibility (SWOT)

3.2

      Check the marketplace

3.3

      Checking the technological capability

3.4

      Checking for the financial feasibility

3.5

      Checking for resources availability

3.6

      Making the decision to proceed the greencar development

4

   Detailed design

4.1

      Setting the product specifications

4.2

      Designing the key characteristics of the product

4.3

      Product drawings

4.4

      Product prototype

5

   Testing of the product

5.1

      Testing the product as per user satisfaction

5.2

      Testing the key characteristics of the car

5.3

      Identification of team for testing the car

6

   Finalize design

6.1

      Review the product design

6.2

      Approval from the board

6.3

      Revise the product design

6.4

      Freeze the product design

7

   Setting up the production of greencar

7.1

      Procure the manufacturing abilities

7.2

      Design the tools

7.3

      Building the tools

7.4

      Modification of the product

7.5

      Obtain the equipments

7.6

      Start up the production

7.7

      Testing the plan

7.8

      Verification of quality tolerances

7.9

      Production in volume

8

   Arrangement of the marketing

8.1

      Identification of the key benefits of the product

8.2

      Identification of potential users

8.3

      Planning the marketing strategies

8.4

      Production of brochures and adverts

8.5

      Produce the advertising campaign

9

   Arrangement of distribution

9.1

      Establishment of sales chain

9.2

      Establishment of business procedures

9.3

      Setting up the technical support and capabilities

9.4

      Write the user manual

9.5

      Write the service manual

9.6

      Obtaining the capabilities of staff

9.7

      Market growth

9.8

      Market maturation

10

   Market decline

10.1

      Declining the sales

10.2

      Refresh of the product

10.3

      Launching the product

10.4

      Differentiating the service

10.5

      Launching the new products

11

   Withdrawal of the product

11.1

      Decision to withdraw

11.2

      Achieve the documentation

12

   Final closure

12.1

      Final sign off the project

12.2

      Final submission of report

Schedule, milestones and dependencies

WBS

Task Name

Duration

Start

Finish

Predecessors

1

Idea generation

11 days

Thu 1/11/18

Thu 1/25/18

 

1.1

   Identify the requirements of the customer

2 days

Thu 1/11/18

Fri 1/12/18

 

1.2

   Evaluate the quality of existing products

5 days

Mon 1/15/18

Fri 1/19/18

2

1.3

   Defining the objectives of new car

4 days

Mon 1/22/18

Thu 1/25/18

3

1.4

Milestone 1: Completion of idea generation

0 day

Thu 1/25/18

Thu 1/25/18

 

2

Concept design

5 days

Fri 1/26/18

Thu 2/1/18

 

2.1

   Create idea generation

3 days

Fri 1/26/18

Tue 1/30/18

4

2.2

   Refine the concepts

2 days

Wed 1/31/18

Thu 2/1/18

6

2.3

Milestone 2: Completion of concept design

0 day

Thu 2/1/18

Thu 2/1/18

 

3

Feasibility study

23 days

Fri 2/2/18

Tue 3/6/18

 

3.1

   Check for the strategic feasibility (SWOT)

5 days

Fri 2/2/18

Thu 2/8/18

7

3.2

   Check the marketplace

5 days

Fri 2/9/18

Thu 2/15/18

9

3.3

   Checking the technological capability

3 days

Fri 2/16/18

Tue 2/20/18

10,4

3.4

   Checking for the financial feasibility

4 days

Wed 2/21/18

Thu 3/1/18

11

3.5

   Checking for resources availability

3 days

Fri 3/2/18

Tue 3/6/18

12

3.6

   Making the decision to proceed the greencar development

1 day

Fri 2/2/18

Fri 2/2/18

7

3.7

Milestone 3: Completion of feasibility study

0 day

Fri 2/2/18

Fri 2/2/18

 

4

Detailed design

23 days

Mon 2/5/18

Wed 3/7/18

 

4.1

   Setting the product specifications

4 days

Mon 2/5/18

Fri 2/9/18

14,3

4.2

   Designing the key characteristics of the product

5 days

Mon 2/12/18

Fri 2/16/18

16

4.3

   Product drawings

6 days

Mon 2/19/18

Mon 2/26/18

17

4.4

   Product prototype

7 days

Tue 2/27/18

Wed 3/7/18

18

4.5

Milestone 4: Completion of product prototype

0 day

Wed 3/7/18

Wed 3/7/18

 

5

Testing of the product

11 days

Thu 3/8/18

Thu 3/22/18

 

5.1

   Testing the product as per user satisfaction

3 days

Thu 3/8/18

Mon 3/12/18

19,13

5.2

   Testing the key characteristics of the car

6 days

Tue 3/13/18

Tue 3/20/18

21

5.3

   Identification of team for testing the car

2 days

Wed 3/21/18

Thu 3/22/18

22

5.4

Milestone 5: Completion of testing of product

0 day

Thu 3/22/18

Thu 3/22/18

 

6

Finalize design

13 days

Fri 3/23/18

Tue 4/10/18

 

6.1

   Review the product design

3 days

Fri 3/23/18

Tue 3/27/18

23

6.2

   Approval from the board

2 days

Wed 3/28/18

Thu 3/29/18

25

6.3

   Revise the product design

5 days

Fri 3/30/18

Thu 4/5/18

26

6.4

   Freeze the product design

3 days

Fri 4/6/18

Tue 4/10/18

27

6.5

Milestone 6: Completion of finalize design

0 day

Tue 4/10/18

Tue 4/10/18

 

7

Setting up the production of greencar

30 days

Fri 4/6/18

Thu 5/17/18

 

7.1

   Procure the manufacturing abilities

3 days

Wed 4/11/18

Fri 4/13/18

28

7.2

   Design the tools

6 days

Mon 4/16/18

Mon 4/23/18

30,21

7.3

   Building the tools

3 days

Tue 4/24/18

Thu 4/26/18

31

7.4

   Modification of the product

6 days

Fri 4/27/18

Thu 5/17/18

32

7.5

   Obtain the equipments

4 days

Fri 4/6/18

Wed 4/11/18

27

7.6

   Start up the production

2 days

Thu 4/12/18

Fri 4/13/18

34

7.7

   Testing the plan

10 days

Mon 4/16/18

Fri 4/27/18

35

7.8

   Verification of quality tolerances

9 days

Mon 4/30/18

Thu 5/10/18

36

7.9

   Production in volume

5 days

Fri 5/11/18

Thu 5/17/18

37

7.10

Milestone 7: Completion of setting up the production of greencar

0 day

Thu 5/17/18

Thu 5/17/18

 

8

Arrangement of the marketing

35 days

Fri 5/18/18

Thu 7/5/18

 

8.1

   Identification of the key benefits of the product

8 days

Fri 5/18/18

Tue 5/29/18

38

8.2

   Identification of potential users

4 days

Wed 5/30/18

Mon 6/4/18

40

8.3

   Planning the marketing strategies

6 days

Tue 6/5/18

Tue 6/12/18

41

8.4

   Production of brochures and adverts

3 days

Wed 6/13/18

Fri 6/15/18

42

8.5

   Produce the advertising campaign

4 days

Mon 6/18/18

Thu 7/5/18

43

8.6

Milestone 8: Completion of arrangement of the marketing

0 day

Thu 7/5/18

Thu 7/5/18

 

9

Arrangement of distribution

35 days

Mon 6/18/18

Fri 8/3/18

 

9.1

   Establishment of sales chain

2 days

Fri 7/6/18

Mon 7/9/18

44

9.2

   Establishment of business procedures

8 days

Tue 7/10/18

Thu 7/19/18

46,38

9.3

   Setting up the technical support and capabilities

7 days

Fri 7/20/18

Mon 7/30/18

47

9.4

   Write the user manual

4 days

Tue 7/31/18

Fri 8/3/18

48

9.5

   Write the service manual

9 days

Mon 6/18/18

Thu 6/28/18

43

9.6

   Obtaining the capabilities of staff

7 days

Fri 6/29/18

Mon 7/9/18

50

9.7

   Market growth

2 days

Tue 7/10/18

Wed 7/11/18

51

9.8

   Market maturation

2 days

Thu 7/12/18

Fri 7/13/18

52

9.9

Milestone 9: Completion of arrangement of distribution

0 day

Fri 7/13/18

Fri 7/13/18

 

10

Market decline

21 days

Mon 7/16/18

Mon 8/13/18

 

10.1

   Declining the sales

2 days

Mon 7/16/18

Tue 7/17/18

53

10.2

   Refresh of the product

3 days

Wed 7/18/18

Fri 7/20/18

55

10.3

   Launching the product

7 days

Mon 7/23/18

Tue 7/31/18

56

10.4

   Differentiating the service

3 days

Wed 8/1/18

Fri 8/3/18

57

10.5

   Launching the new products

6 days

Mon 8/6/18

Mon 8/13/18

58

10.6

Milestone 10: Completion of market decline

0 day

Mon 8/13/18

Mon 8/13/18

 

11

Withdrawal of the product

7 days

Tue 8/14/18

Wed 8/22/18

 

11.1

   Decision to withdraw

4 days

Tue 8/14/18

Wed 8/22/18

59

11.2

   Achieve the documentation

5 days

Tue 8/14/18

Mon 8/20/18

56

11.3

Milestone 11: Completion of withdrawal of the product

0 day

Mon 8/20/18

Mon 8/20/18

 

12

Final closure

2 days

Tue 8/21/18

Wed 8/22/18

 

12.1

   Final sign off the project

1 day

Tue 8/21/18

Tue 8/21/18

62

12.2

   Final submission of report

1 day

Wed 8/22/18

Wed 8/22/18

64

12.3

Milestone 12: Completion of final closure

0 day

Wed 8/22/18

Wed 8/22/18

 

Slack time, earliest start and latest finish for the project

WBS

Task Name

Early Start

Late Finish

Total Slack

1

Idea generation

Thu 1/11/18

Thu 1/25/18

0 days

1.1

Identify the requirements of the customer

Thu 1/11/18

Fri 1/12/18

0 days

1.2

Evaluate the quality of existing products

Mon 1/15/18

Fri 1/19/18

0 days

1.3

Defining the objectives of new car

Mon 1/22/18

Thu 1/25/18

0 days

2

Concept design

Fri 1/26/18

Thu 2/1/18

0 days

2.1

Create idea generation

Fri 1/26/18

Tue 1/30/18

0 days

2.2

Refine the concepts

Wed 1/31/18

Thu 2/1/18

0 days

3

Feasibility study

Fri 2/2/18

Wed 3/7/18

0 days

3.1

Check for the strategic feasibility (SWOT)

Fri 2/2/18

Fri 2/9/18

1 day

3.2

Check the marketplace

Fri 2/9/18

Fri 2/16/18

1 day

3.3

Checking the technological capability

Fri 2/16/18

Wed 2/21/18

1 day

3.4

Checking for the financial feasibility

Wed 2/21/18

Fri 3/2/18

1 day

3.5

Checking for resources availability

Fri 3/2/18

Wed 3/7/18

1 day

3.6

Making the decision to proceed the greencar development

Fri 2/2/18

Fri 2/2/18

0 days

4

Detailed design

Mon 2/5/18

Wed 3/7/18

0 days

4.1

Setting the product specifications

Mon 2/5/18

Fri 2/9/18

0 days

4.2

Designing the key characteristics of the product

Mon 2/12/18

Fri 2/16/18

0 days

4.3

Product drawings

Mon 2/19/18

Mon 2/26/18

0 days

4.4

Product prototype

Tue 2/27/18

Wed 3/7/18

0 days

5

Testing of the product

Thu 3/8/18

Thu 3/22/18

0 days

5.1

Testing the product as per user satisfaction

Thu 3/8/18

Mon 3/12/18

0 days

5.2

Testing the key characteristics of the car

Tue 3/13/18

Tue 3/20/18

0 days

5.3

Identification of team for testing the car

Wed 3/21/18

Thu 3/22/18

0 days

6

Finalize design

Fri 3/23/18

Mon 7/16/18

0 days

6.1

Review the product design

Fri 3/23/18

Tue 3/27/18

0 days

6.2

Approval from the board

Wed 3/28/18

Thu 3/29/18

0 days

6.3

Revise the product design

Fri 3/30/18

Thu 4/5/18

0 days

6.4

Freeze the product design

Fri 4/6/18

Mon 7/16/18

69 days

7

Setting up the production of greencar

Fri 4/6/18

Wed 8/22/18

0 days

7.1

Procure the manufacturing abilities

Wed 4/11/18

Thu 7/19/18

69 days

7.2

Design the tools

Mon 4/16/18

Fri 7/27/18

69 days

7.3

Building the tools

Tue 4/24/18

Wed 8/1/18

69 days

7.4

Modification of the product

Fri 4/27/18

Wed 8/22/18

69 days

7.5

Obtain the equipments

Fri 4/6/18

Wed 4/11/18

0 days

7.6

Start up the production

Thu 4/12/18

Fri 4/13/18

0 days

7.7

Testing the plan

Mon 4/16/18

Fri 4/27/18

0 days

7.8

Verification of quality tolerances

Mon 4/30/18

Thu 5/10/18

0 days

7.9

Production in volume

Fri 5/11/18

Thu 5/17/18

0 days

8

Arrangement of the marketing

Fri 5/18/18

Tue 7/24/18

0 days

8.1

Identification of the key benefits of the product

Fri 5/18/18

Tue 5/29/18

0 days

8.2

Identification of potential users

Wed 5/30/18

Mon 6/4/18

0 days

8.3

Planning the marketing strategies

Tue 6/5/18

Tue 6/12/18

0 days

8.4

Production of brochures and adverts

Wed 6/13/18

Fri 6/15/18

0 days

8.5

Produce the advertising campaign

Mon 6/18/18

Tue 7/24/18

13 days

9

Arrangement of distribution

Mon 6/18/18

Wed 8/22/18

0 days

9.1

Establishment of sales chain

Fri 7/6/18

Thu 7/26/18

13 days

9.2

Establishment of business procedures

Tue 7/10/18

Tue 8/7/18

13 days

9.3

Setting up the technical support and capabilities

Fri 7/20/18

Thu 8/16/18

13 days

9.4

Write the user manual

Tue 7/31/18

Wed 8/22/18

13 days

9.5

Write the service manual

Mon 6/18/18

Thu 6/28/18

0 days

9.6

Obtaining the capabilities of staff

Fri 6/29/18

Mon 7/9/18

0 days

9.7

Market growth

Tue 7/10/18

Wed 7/11/18

0 days

9.8

Market maturation

Thu 7/12/18

Fri 7/13/18

0 days

10

Market decline

Mon 7/16/18

Mon 8/13/18

0 days

10.1

Declining the sales

Mon 7/16/18

Tue 7/17/18

0 days

10.2

Refresh of the product

Wed 7/18/18

Fri 7/20/18

0 days

10.3

Launching the product

Mon 7/23/18

Tue 7/31/18

0 days

10.4

Differentiating the service

Wed 8/1/18

Fri 8/3/18

0 days

10.5

Launching the new products

Mon 8/6/18

Mon 8/13/18

0 days

11

Withdrawal of the product

Tue 8/14/18

Wed 8/22/18

0 days

11.1

Decision to withdraw

Tue 8/14/18

Wed 8/22/18

0 days

11.2

Achieve the documentation

Mon 7/23/18

Mon 8/20/18

0 days

12

Final closure

Tue 8/21/18

Wed 8/22/18

0 days

12.1

Final sign off the project

Tue 8/21/18

Tue 8/21/18

0 days

12.2

Final submission of report

Wed 8/22/18

Wed 8/22/18

0 days

 

Resource and cost plan

Estimates relevant for the project

Estimation of both cost and schedule is relevant for this project. Cost estimation is required to determine the total cost needed to conduct the event on green cars. It is required to estimate strength and weakness of the project work. The accuracy of cost estimation makes the success of project. Schedule estimation is required to determine the start and end date of the project work. Without schedule estimation, how long the project will be taken is not estimated. When the project will finish within estimated schedule, then the project will success.

Pricing estimation and resource allocation

WBS

Task Name

Resource Names

Cost

0

Greencar product development and launch

 

$60,400.00

1

   Idea generation

 

$3,440.00

1.1

      Identify the requirements of the customer

Event Manager, Project Manager

$960.00

1.2

      Evaluate the quality of existing products

Project Manager

$1,200.00

1.3

      Defining the objectives of new car

Marketing Manager, Project Manager

$1,280.00

2

   Concept design

 

$1,360.00

2.1

      Create idea generation

Project Manager

$720.00

2.2

      Refine the concepts

Marketing Manager, Project Manager

$640.00

3

   Feasibility study

 

$7,120.00

3.1

      Check for the strategic feasibility (SWOT)

Executive Manager, Marketing Manager, Project Manager

$1,440.00

3.2

      Check the marketplace

Executive Manager, Marketing Manager

$1,200.00

3.3

      Checking the technological capability

Executive Manager, Marketing Manager, Project Manager

$960.00

3.4

      Checking for the financial feasibility

Project Manager

$960.00

3.5

      Checking for resources availability

Executive Manager, Project Manager, Chartered financial accountant

$2,160.00

3.6

      Making the decision to proceed the greencar development

Executive Manager, Project Manager

$400.00

4

   Detailed design

 

$6,800.00

4.1

      Setting the product specifications

Executive Manager, Project Manager

$800.00

4.2

      Designing the key characteristics of the product

Project Manager

$1,200.00

4.3

      Product drawings

Designer, Project Manager

$1,440.00

4.4

      Product prototype

Customer Service Manager, Designer, Tester

$3,360.00

5

   Testing of the product

 

$2,320.00

5.1

      Testing the product as per user satisfaction

Designer, Marketing Manager, Tester

$1,200.00

5.2

      Testing the key characteristics of the car

Tester

$480.00

5.3

      Identification of team for testing the car

Project Manager, Tester

$640.00

6

   Finalize design

 

$4,240.00

6.1

      Review the product design

Project Manager, Tester

$960.00

6.2

      Approval from the board

Project Manager

$480.00

6.3

      Revise the product design

Marketing Manager, Project Manager

$1,600.00

6.4

      Freeze the product design

Customer Service Manager, Event Manager

$1,200.00

7

   Setting up the production of greencar

 

$14,240.00

7.1

      Procure the manufacturing abilities

Event Manager, Executive Manager

$1,200.00

7.2

      Design the tools

Designer

$1,440.00

7.3

      Building the tools

Project Manager

$720.00

7.4

      Modification of the product

Designer, Executive Manager

$2,400.00

7.5

      Obtain the equipments

Marketing Manager, Project Manager

$1,280.00

7.6

      Start up the production

Project Manager

$480.00

7.7

      Testing the plan

Tester

$800.00

7.8

      Verification of quality tolerances

Designer, Executive Manager, Tester

$4,320.00

7.9

      Production in volume

Marketing Manager, Project Manager

$1,600.00

8

   Arrangement of the marketing

 

$4,960.00

8.1

      Identification of the key benefits of the product

Project Manager

$1,920.00

8.2

      Identification of potential users

Project Manager

$960.00

8.3

      Planning the marketing strategies

Marketing Manager

$480.00

8.4

      Production of brochures and adverts

Marketing Manager, Project Manager

$960.00

8.5

      Produce the advertising campaign

Marketing Manager, Project Manager

$640.00

9

   Arrangement of distribution

 

$8,880.00

9.1

      Establishment of sales chain

Customer Service Manager, Marketing Manager

$480.00

9.2

      Establishment of business procedures

Marketing Manager, Project Manager

$1,280.00

9.3

      Setting up the technical support and capabilities

Project Manager

$1,680.00

9.4

      Write the user manual

Project Manager

$960.00

9.5

      Write the service manual

Project Manager

$2,160.00

9.6

      Obtaining the capabilities of staff

Executive Manager, Project Manager

$2,000.00

9.7

      Market growth

Marketing Manager

$160.00

9.8

      Market maturation

Marketing Manager

$160.00

10

   Market decline

 

$4,480.00

10.1

      Declining the sales

Customer Service Manager, Project Manager

$800.00

10.2

      Refresh of the product

Customer Service Manager, Executive Manager

$960.00

10.3

      Launching the product

Marketing Manager

$560.00

10.4

      Differentiating the service

Marketing Manager

$240.00

10.5

      Launching the new products

Marketing Manager, Project Manager

$1,920.00

11

   Withdrawal of the product

 

$1,280.00

11.1

      Decision to withdraw

Marketing Manager

$320.00

11.2

      Achieve the documentation

Marketing Manager, Project Manager

$960.00

12

   Final closure

 

$1,280.00

12.1

      Final sign off the project

Chartered financial accountant, Project Manager

$560.00

12.2

      Final submission of report

Chartered financial accountant, Executive Manager, Project Manager

$720.00

Risks affect cost and schedule

The market risk affects the cost of equity funding which will directly affects the cost of the project. Scope change in the project also affects time and cost, as scope change will affect the activities of the project which will result into delay of the project plan. When the project will delay by 1-2 days, then it raises the total estimated cost off the project.

 

 

Monitor performance in the project

An activity schedule performance is done by noting of the dates the project begins and ends. The statuses of the individual activities are checked on regular basis to analyze if the project is on track or not. Cost and schedule variance metrics are required to check the progress of the project work. 

 

Bibliography

Fleming, Q.W. and Koppelman, J.M., 2016, December. Earned value project management. Project Management Institute.

Leach, L.P., 2014. Critical chain project management. Artech House.

Lock, M.D., 2014. The essentials of project management. Ashgate Publishing, Ltd..

Marcelino-Sádaba, S., Pérez-Ezcurdia, A., Lazcano, A.M.E. and Villanueva, P., 2014. Project risk management methodology for small firms. International Journal of Project Management, 32(2), pp.327-340.

Nicholas, J.M. and Steyn, H., 2017. Project management for engineering, business and technology. Taylor & Francis.

Schwalbe, K., 2015. Information technology project management. Cengage Learning.

Tarhini, A., Ammar, H. and Tarhini, T., 2015. Analysis of the critical success factors for enterprise resource planning implementation from stakeholders’ perspective: A systematic review. International Business Research, 8(4), p.25.

Todorovi?, M.L., Petrovi?, D.?., Mihi?, M.M., Obradovi?, V.L. and Bushuyev, S.D., 2015. Project success analysis framework: A knowledge-based approach in project management. International Journal of Project Management, 33(4), pp.772-783.

Turner, R., 2016. Gower handbook of project management. Routledge.

Verzuh, E., 2015. The fast forward MBA in project management. John Wiley & Sons

Plan (Schedule)
Work breakdown structure
Monitor performance in the project
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