A project risk management plan for designing an Automated Mobile Defense System or AMDS is essential since the goal of a project manager is to finish the project within budget and on time, and this can be severely affected by the potential risks faced during the entire duration of the project. Proper planning by utilizing a risk management plan is necessary to determine what risks could delay the project affecting its outcome and to take immediate actions to rectify them. Such a plan also helps in making a formal presentation to the stakeholders of the projects since it addresses their interests. The following are the major risks that can occur during the course of a project and need to be handled immediately.
Strength of the material
The strength of the material is important when building the MHU, SKYEYE, ABMs and AAMC since they need to withstand a lot of stress without failure. It must be able to hold a lot of strain energy without being damaged, permanently. If the material is not resilient enough then the devices and ammunitions will not hold and thus, will be of no interest to the stakeholders. Efficiency and cost of these structures, which are important factors for the stakeholders, depend on the strength of the material which can be computed quantitatively by using scientific procedures. (Holmes, 2002)
Cost of the material
Since the cost of materials is variable this is a qualitative risk and is an unknown factor. Whether the cost of the material increases in the future or not should be estimated using existing historical information, since the stakeholders would want to complete the project within the specified budget of $1.5 billion and not overshoot. Given that the actual increase in cost cannot be assessed at present, an apparent increase in the cost variance needs to be estimated as it helps in determining the entire budget of the project.
Shortage of material
This is also a qualitative risk since it cannot be actually assessed at the present time and should be estimated based on calculations, market position and existing historical information. This risk is also very important to address from the point of view of the stakeholders since the entire design of the AMDS is conceptual and the stakeholders need to be ready to deal with the various time delays and financial impacts on the project due to shortage of materials.
Manufacturing delays
Manufacturing delays generally occur, either due to poor planning in the purchasing section or as a direst result of failing revenues. However, this is a quantitative risk and if the stakeholders are aware of the facilities costs and labor costs then a minimum monetary amount can be assigned to the manufacturing delay. It should be kept in mind that the expected time for completion of the project is 5 years and thus the assignments should be made accordingly. (Gordon, 2008)
Employee turnover
This risk can be qualitative as well as quantitative. Although we know how much each employee, engineers, scientists or technological professionals, costs or how much it may cost if we want to replace them, we will not be able to manage the frequency or amount of employee turnover. Employee turnover is also a costly expenditure and can even be detrimental to the project, affecting the interest of the stakeholders. Before trying to reduce employee turnover we need to determine what its causes are. Dysfunctional turnovers may be caused by a mismatch between employee and job skills, inferior facilities or poor supervision.
Loss in funding
Although losses in funding could pose a serious threat to the completion of the project, this risk is quantitative in nature since we already know exactly what the cost of the entire project should be. The budget needs to be determined before commencing the project and it should also be discussed with the stakeholders. Losses in funding if not addressed immediately could even lead to manufacturing delays and loss of employees which could further delay the completion of the project.
Emergence of new and advanced technology
Since this is an unexpected risk, it is qualitative in nature. The technology that has been used in building the structures, ammunition and devices could change or improve any time. We cannot even estimate when new technology will emerge at the present time or how much the emergence of new technology could set us back into time. For the interest of the stakeholders we also need to estimate what it would cost us to speed up and match ourselves to the advanced technologies of the future. New technology will also require additional maintenance in the form of energy and time, thus we should see to it that the project is completed within intended time. Since new technology is initially unknown to most of the employees handling it, it sometimes even causes unexpected and unintended effects. (Frenkel, 2005)
Loss of government or public trust
Since this project is intended for building an AMDS for the US Department of Defense, failure of this project could even lead to diminished chances in acquiring any of their future projects. The principle goal of this project is to successfully build up a defense system which can protect the US citizens and soldiers of certain strategic and major cities during a missile attack, thus, it should abide by the trust of the public. Also, if the project fails, not only will the credibility of the stakeholders be questioned but the project will also have to suffer losses in its investment revenues and government funding. Since the failure of a project cannot be estimated or calculated at the present time, it is a qualitative risk which poses a serious threat for the stakeholders. (Gallati, 2003)
Product transportation and specification
Since our product is an Automated Mobile Defense System, its complexity is high and since the MHU will contain ABMs, AAMC and SKYEYE the entire unit will be quite heavy. The detection device or SKYEYE will also be built on our patented radar technology. In addition, the MHU, which is an 18 wheeled tractor trailer, will have solar charged batteries and autonomous power sources for the individual devices making the entire AMDS automatic and portable.
Thus, the entire project being complex will have to abide by the US Department of Defense guidelines regarding road transportation and the specifications of the entire unit should be sizable so that it can be mounted on the intended tractor trailer unit while being transported. Also, the time taken and cost for transporting the entire project to the intended cities should be such that it interests the stakeholders and is within the intended budget and schedule of the project.
References
Frenkel, M. (2005) Risk management: challenge and opportunity. LA: Springer.
Gallati, R.R. (2003) Risk management and capital adequacy. LA: McGraw-Hill Professional.
Gordon, D. (2008) Managing Project Risk: Best Practices for Architects and Related Professionals. New York: John Wiley and Sons.
Holmes, A. (2002) Risk Management. New York: John Wiley & Sons.