PM FPX 5332 Assessment 4 Risk Management Plan

PM FPX 5332 Assessment 4 Risk Management Plan

Student Name

Capella University

PM-FPX5332 Project Management, Planning, Execution, and Control

Prof. Name:

Date

Introduction

The intent of developing the Risk Management Plan is to address the inherent risks associated with projects, which affect individuals and businesses alike. All projects carry risks due to their unique nature and varying complexities, which aim to deliver specific benefits (PMBOK, 2017). While risks cannot be entirely eliminated, they can be effectively managed through preparation. This management occurs within a framework of constraints and assumptions, while also responding to potentially conflicting and evolving stakeholder expectations (PMBOK, 2017). This risk management plan will encompass the project description, risk management principles, processes, planning, and analysis.

Project Description

Cosmo, Inc. has established itself as a leading manufacturer of wearable technology. However, following a comprehensive market analysis, the President and CEO identified a potential issue that could adversely affect future earnings. The report indicated that competition from other companies could threaten its current 33% market share. The objective is to assess this perceived threat by formulating a plan that aims to mitigate or eliminate the risk of losing market share. Cosmo will devise a swift and validated plan to introduce new technology to the market. The challenge lies in integrating this technology into existing ERP and marketing systems to create a successful formula. This new marketing strategy must be executed within a budget of $150,000 and completed within 10 weeks. To facilitate this project, staffing and communication plans have been established.

Guiding Risk Management Principles

This project will employ the tools and techniques from PMBOK (2017) as outlined below in its approach to risk management:

• Expert Judgment: The Project Manager will invite resources with experience in similar projects to participate in data-gathering sessions aimed at identifying and addressing potential risks. The outcomes will be presented to the Project Sponsor.

• Data Gathering through Brainstorming: A group of individuals with prior experience in similar projects will engage in data-gathering sessions facilitated by the Project Manager. These sessions will be informal, allowing participants to share issues encountered in past projects.

• Meetings: Weekly meetings will be held to discuss risks and risk mitigation as they arise. An initial brainstorming session will be conducted, followed by ongoing weekly change review board meetings and segment status checks to communicate and document any risks.

• Documents: A risk register will be maintained as necessary. This register will include identified risks, potential owners, and possible risk responses. A risk report will be generated to provide information on individual risks and their impact on the overall project.

Risk Management Process

Risk Identification

Based on an analysis of known and unknown risks associated with the project, the following specific risks may impact project outcomes (costs, time, quality, performance) and their characteristics are documented below:

• Delay of Microchips: If microchips are delayed by the IT department, it could affect the completion date, as all microchips must be delivered for testing to proceed. (NEGATIVE)

• Lack of Resource Availability: Insufficient availability of resources may result in missed deadlines, delaying the overall project launch date. (NEGATIVE)

• Software Enhancement Effects on Existing Functionality: If the deployment of additional features negatively impacts existing software functionality, it may necessitate additional development and testing work that is not accounted for in the current budget and timelines. (NEGATIVE)

• Lack of Funds: If the full budget is not approved or available, the project may need to be scaled back or paused until full funding is secured. (NEGATIVE)

• Manufacturing Volume: If the manufacturing teams are unable to increase their output, there will be delays in fulfilling orders, leading to negative customer impacts and potentially decreased sales. (NEGATIVE)

• Developmental Gaps: If there are gaps in the requirements used by the development team, issues may arise during the user acceptance testing phase, necessitating redevelopment that could extend timelines and jeopardize deadlines. (NEGATIVE)

• Testing Errors: If issues are not identified during unit, quality assurance, or user testing, there is a risk that these problems will reach production, resulting in negative customer experiences and costly urgent fixes. (NEGATIVE)

PM FPX 5332 Assessment 4 Risk Management Plan

• Missed Deadlines: Each team must meet their task deadlines to ensure the launch date is met; if any team fails to meet their deadlines, the entire project could face potential delays and increased costs not accounted for in the original budget. (NEGATIVE)

• Increased Delivery Times: If the marketing campaign is overly successful and sales exceed projected volumes, there is a risk of customer dissatisfaction due to longer delivery times. (NEGATIVE)

• Misdiagnosed Target Audience: If the marketing team inaccurately analyzes a potential market segment, sales may not increase as anticipated from the new features and marketing campaign, leading to a poor return on investment. (NEGATIVE)

• Safeguard System Update Failure: If the conversion of the current ERP with the safeguard system fails, the IT team must be prepared to address the issue promptly(NEGATIVE) 

Risk Planning & Analysis

Risk Matrix Legend:

To quantify the probability and impact levels of risks, a risk matrix legend is defined as follows:

Risk Matrix Legend Example:

Project Risk Matrix Legend:

Risk Matrix:

The risk matrix serves as a graphical representation of identified risks, evaluating them in terms of the probability (likelihood) of occurrence and their impact on project success factors such as costs, time, and quality. The definitions of risk probability and impact levels are tailored to the specific project and reflect the organization’s risk appetite and thresholds.

• Risk #: Numerical identifier for the risk
• Risk: Description of the risk (e.g., Weather impacts – storm season)
• Probability: Likelihood of the risk occurring (e.g., H, M, L)
• Impact: Level of impact on project success factors (e.g., H, M, L)
• Response to Risk: Strategies such as Avoid, Mitigate, Transfer, and Accept
• Action Plan: Detailed steps for risk mitigation
• Person Responsible: Individual managing the mitigation strategy
• Status: Current status of the mitigation process

COLOR CODED MATRIX – PROBABILITY AND IMPACT

Risk Monitoring and Control

To ensure that the project team and key stakeholders remain informed about the current level of risk exposure, project work should be continuously monitored for new, changing, and outdated project risks, as well as for changes in the overall project risk level by applying the Monitor Risks process (PMBOK, 2017). Since monitoring and control is an ongoing process throughout the project lifecycle, the following outlines the monitoring process, review, reporting, and assignment of ownership and time estimates.

Monitoring Process:

• Define monitoring process of current and new risks:
  • Review risk plans and potential triggers for risks.
  • Weekly status meetings will monitor all aspects of the project, minimizing the risk of delays.
  • Owner: Segment/Team leads
  • Time Estimate: Weekly 1-hour meetings

Review:

• Define stages or timeframes for specific types of review:
  • Weekly status meetings will monitor all aspects of the project. If risks arise in the early stages, the project manager will address them.
  • Proposed solutions or changes to mitigate risks will be brought to weekly meetings.
  • Owner: Program Manager
  • Time Estimate: Weekly 1-hour meeting

Reporting:

• Provide types of communication channels and deliverables:
  • Risk Register: Document all potential risks discussed during meetings.
  • Document corrective actions taken.
  • Risk Report: Outline preventive measures to reduce risk.
  • Issue Log
  • Assumption Log
  • Lessons Learned Register
  • Owner: Program Manager
  • Time Estimate: Ongoing throughout the entire project

References

Project Management Institute. (2017). A Guide to the Project Management Body of Knowledge: (PMBOK Guide) – Sixth Edition/Agile Practice Guide Bundle. (Sixth).

PM FPX 5332 Assessment 4 Risk Management Plan