PM FPX 5334 Assessment 1 Introduction to the Plan

PM FPX 5334 Assessment 1 Introduction to the Plan

Student Name

Capella University

PM-FPX5334 Project Risk Assessment and Control

Prof. Name:

Date

Section 1 – Introduction to the Plan

1.1 Benefits of Risk Management

Developing a risk management plan is crucial for achieving project objectives. The following risk management plan identifies, assesses, and provides mitigation guidelines for risks faced by virtual teams. As technology continues to evolve, individuals can connect virtually in numerous ways. While adopting these technological solutions may benefit workplace projects, it also introduces risks. By using this risk management plan, organizations may be able to identify less obvious risks, assess those risks for likelihood and impact, and develop responses to mitigate potential losses.

1.2 Project Goals and Objectives

The plan’s goals and objectives focus on evaluating risks related to a project. The objective of this project is to mitigate risks encountered by virtual teams, allowing the organization to effectively use virtual teams, which offer numerous potential benefits. Factors such as employee safety, minimizing office space, and reducing travel time can be realized if the organization successfully utilizes virtual teams. As globalization increases, organizations are no longer constrained by traditional workgroup limitations, such as geography or time (Regueira, 2016). Capitalizing on virtual teams requires assessing new risks associated with them. Some of these elements include communication, coordination, and technology (Regueira, 2016). Other goals for the virtual team risk mitigation project include improving these factors.

1.3 Company Background

This project is relevant to many organizations aiming to leverage virtual teams. Beneficiaries of virtual teams range from the Board of Directors, if the organization becomes more efficient, to customers, if the virtual team can deliver high-quality performance. The role of leadership is to provide oversight and vision for the organization as a whole. Customers engage in a transactional relationship with the organization and support the business mission in exchange for products or services. Specific roles within this context include the project manager, who is responsible for organizing, planning, and allocating resources to meet the project’s objectives (Regueira, 2016). The team responsible for executing dependent tasks is referred to as the project team. Individual team members possess specific skill sets that contribute to the project’s success. This group implements the project’s scope through technological resources. This not only delivers potential benefits but is also highly appropriate given the current climate. Virtual teams enable safe social distancing, keeping the workforce healthy and productive.

1.4 Risk Identification

Risk identification strategies suitable for the project are defined, and parameters for analysis are established.

Qualitative Risk Assessment: A rating scale of probability and severity is defined to prioritize identified project risks.

Quantitative Risk Assessment: Further assessment quantifies probability measures based on achieving the project objectives. Specific variables such as cost and time are used.

For this project, a qualitative risk assessment will be used to evaluate specific risks to virtual teams. This approach allows flexibility across different settings, benefiting various situations or organizations. A probability scale of low, medium, and high will be applied, while a severity scale ranging from no impact to catastrophic will be used in conjunction with the probability scale. To identify risks, an analysis of J. Regueira Jr.’s case study on risk identification and risk management in virtual project teams, along with expert judgment, will be utilized.

Section 2 – Risk Scope, Components, and Value

2.1 Scope of the Risk Management Plan

The scope of this risk mitigation plan applies to the use of virtual teams within an organization. Teams are defined as consisting of a project manager and no more than eight team members. This plan explores potential risks associated with virtual teams in contrast to face-to-face teams. Qualitative assessment of significant risks in virtual team meetings will not be extended to every specific scenario but will provide a general approach to the virtual business environment emerging today.

2.2 Risk Management Plan Components

This risk management plan is based on a review of J. Regueira Jr.’s case study on risk identification and risk management in virtual project teams, as well as Jared Palmer’s experience working in virtual teams. Risks will be identified, assessed, and measured based on probability and severity. Literature review will be used to identify risk factors, including team engagement, multitasking, incorrect dates or scheduling, poor communication, and inadequate project accuracy. The probability of these risks occurring is outlined in the literature. Severity will be assessed based on expert judgment. This plan is divided into five sections: Introduction, Scope, Analysis, Corrective Action, and Post-Completion. The analysis section will primarily rely on J. Regueira Jr.’s case study for identifying risks and their likelihood. While severity may vary from team to team, it will be evaluated based on experience with virtual teams. The corrective action section will recommend solutions the project manager may take to mitigate each risk. The final section will outline knowledge management and lessons learned.

2.3 Expected Monetary Value

An expected monetary value (EMV) analysis will be applied to estimate the cost of a project without a risk plan and articulate the benefits of a risk management plan. Estimating financial value in relation to the productivity of virtual teams is challenging. Factors to consider in this analysis include:

• Office Space (in case of failed virtual teams)
• Commute time (among meetings and physical locations)
• Productivity time (amount of time a team member can spend on a specific task)
• Quality of Product (rework time for products that do not meet specifications)

One specific cost is office space. According to Novel Coworking, the cost of a private office is $300-$500 per month per employee, compared to the virtual office cost of $59-$100 per month per employee (Novel Coworking, 2019). This reduction in cost could be realized through the effective use of virtual teams. The benefits of this plan would not only reduce costs for organizations but also offer a work-life balance, an expanded talent pool, and faster turnaround times. These advantages could be achieved through efficient virtual teams that mitigate the risks outlined in this plan.

2.4 Determine the Risks

Specific risks to virtual teams, as outlined in J. Regueira Jr.’s case study on risk identification and risk management in virtual project teams, include:

• Team engagement: There is potential for members not to engage with each other in virtual settings. Monitoring this lack of team commitment is harder than in face-to-face meetings.
• Multitasking: As teams are able to meet online, they may multitask on other projects during team meetings, making it difficult to focus on the task at hand.
• Incorrect dates or scheduling: Virtual teams are still new for many organizations, making project estimation challenging. Factors such as scheduling or budget errors could negatively impact the project.
• Poor communication: Brainstorming or problem-solving in virtual environments can be challenging due to new communication obstacles (e.g., visual aids like whiteboards may not be easily presented) (Regueira, 2016).
• Poor project accuracy: Underestimating or overestimating tasks can negatively affect product quality, delay deadlines, or impact customer satisfaction. Client Constraints

In managing client constraints, the key issues include scope creep, budget, and schedule. Effective management of these risks is critical to the success of the virtual team. If scope creep is not well-managed, the team may encounter prolonged projects or require more resources than initially allocated. Poor estimation of budget or schedule can also negatively impact the team. If the project is under-budgeted or under-scheduled, the team may struggle to generate revenue and meet deadlines. Conversely, if the project is over-budgeted or over-scheduled, there may not be enough work to keep the team engaged.

Qualitative and Quantitative Processes

The primary analysis method for this virtual team risk management framework will be qualitative. Specific risks will be assessed based on probability and severity. Risks mentioned in a case study on risk identification and management in a virtual project team by Jorge Regueira Jr. were reported by virtual team members, and probability scores were provided. Risks identified through an interview with a virtual team leader will be evaluated for probability based on experience. These probabilities will then be ranked from most likely to least likely and rated on a scale of 1-4. Severity will be rated by the level of disadvantage to the team on a scale of 1-4. The risks will be analyzed using the decision tree shown in Figure 2.

Section 3 – Risk Analysis and Assessment

Major and Minor Risks

Further analysis of virtual team risks includes categorizing them into major and minor risks. To categorize these risks, the decision tree in Figure 2 will be utilized. This qualitative approach will focus on the severity side of the tree and define minor risks as those rated at levels 1 or 2, indicating less than a 5% change in budget or schedule. Major risks are classified as those with more than a 5% impact on the budget or schedule. Figure 3 outlines the classification of risks mentioned in a case study by Jorge Regueira Jr. and the corresponding interview.

Depending on the specific context of the team, the severity of these risks may differ from what is outlined in Figure 3. This classification is dynamic but provides a starting point for project managers to address risks within their teams.

Risk Probability

Estimating likelihood can be challenging, especially with qualitative analysis. In the case of virtual teams, external resources for probability include a literature review and advice from an individual who has managed virtual teams for over a decade. Based on these inputs, a probability score of 1-4 was established. The literature provides probability estimates from studies on virtual teams, and specific risks were given a score based on how frequently they were mentioned by virtual teams. These scores informed the development of a 1-4 probability scale. Expert opinions during interviews also contributed to determining the probability of the identified risks. These evaluations formed the basis of this risk management plan. A potential improvement to this method involves collecting risks mentioned during interviews and surveying teams on the frequency of specific risks. This would allow for a better scale based on each risk’s correlation to the next. Given these factors, I am confident that these probability scores will apply to many virtual teams across various organizations.

Risk Matrix Template

Risk Matrix

Risk Data Quality Strategy

To assess project risks, the specific elements can be grouped into two categories: social and task-based. Social risks are those related to team cohesion, communication, multitasking, and engagement. Task-based risks are objective factors like customer satisfaction, duplication of effort, accuracy, and schedule or budget. Data for social factors can be gathered by surveying virtual team members. These risks must be addressed as they arise. For instance, a virtual team may begin with excellent communication or engagement, but these factors can diminish as the project progresses. When this happens, the responsible party should address the risk.

Task-based risks are more objectively identified through data. For example, variances in budget, schedule, or accuracy are easily noticeable. These risks should be mitigated at the start of the project. Additionally, duplication of effort can be identified by everyone and managed through project management tools. The process for gathering data for project-based risks involves documenting whenever an action deviates from the original agreement. For example, if a deadline is missed, the challenges leading to the delay should be recorded. For instance, if the supplier is waiting for input from the customer for product development, this could cause a delay in the schedule, which is a risk.

PM FPX 5334 Assessment 1 Introduction to the Plan

Collecting social risk data involves surveying the team throughout the project. Questions regarding engagement, multitasking, communication, and cohesion can provide insight into how well the team is functioning. This data will be unique to the team since it is generated by them. Ensuring quality in this process involves conducting a risk data quality assessment, which evaluates the accuracy and reliability of individual project risks (Project Management Institute, 2017). Establishing a risk log is crucial to prevent low-quality data from jeopardizing mitigation strategies.

This begins with a standard operating procedure for documenting risks. Specific details required include risk ID, risk category, specific risk name, date, intervention, and results. Data can be stored in a SharePoint list for analysis. To continuously monitor the data, surveys can be used to support the information. Key stakeholders can be asked about specific risks, and their responses compared to the risk log. This includes surveying virtual teams about social risks and surveying team leaders and customers about task-based risks. Comparing these responses to the identified risks and the effectiveness of mitigation strategies ensures high-quality risk logs.

Risk Reviews

Risks will be discussed at weekly meetings between the project manager and virtual team lead. Each risk will be assigned a status code (green, yellow, or red), depending on the current severity of the risk. These risks will be addressed accordingly, and progress will be monitored throughout the project.

Corrective Action and Monitoring

Risk Tolerance

The organizational and departmental tolerance for risk must be evaluated. This involves discussing the different levels of risk tolerance within the organization.

Risk Mitigation

Risk mitigation strategies must be identified in support of the project. This includes identifying triggers to initiate mitigation and implementing the appropriate mitigation strategies.

Corrective Risk Management Strategy

A corrective risk management strategy should be described, detailing whether auditing, strategic planning, or another method will be used. The corrective action process and responsibilities should be explained, along with whether a risk postmortem will be performed.

Corrective Action Plan

Procedures for corrective action should be assessed, including the availability and review of documentation.

Postmortem Plan

Results

The results of the postmortem should be collected and reviewed to determine corrective actions. This will involve identifying any changes resulting from the postmortem analysis.

Follow-Up

The organization’s approach to risk management should be evaluated, considering the outcomes of the project. The impact of the postmortem results on the organization should be described, and recommendations for future risk management projects should be provided.

References:

Novel Coworking. (2019). The cost of a virtual office. Retrieved from https://www.novelcoworking.com/virtual-office-cost

PM FPX 5334 Assessment 1 Introduction to the Plan

Regueira, J. (2016). Risk identification and risk management in virtual project teams.