Risk Matrix

Risk Matrix

Evaluation of Risk for the Supply and Delivery of the Backpack Product with a Built-In Refrigeration Pouch and Radio Module to the U.S. Army

This report intends to identify and evaluate the cost, probability, impact, mitigation plan, and expiration dates for risks arising from the supply and delivery of the backpack product with a built-in refrigeration pouch and radio module to the U.S. Army, Ground Forces, and Special Operations.

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Technological Risks

SuperPacks faces technological risks in delivering a new backpack product with a built-in refrigeration pouch and radio module. New technological innovations could be launched midway through the completion of the project (Kerzner, 2017). For instance, modified and advanced parts and products utilized in production. Depending on the disparity, the firm would have to adopt these advancements that could translate to starting the project from scratch. On the same note, the firm could encounter a delay in software and hardware updates that disrupt operations. These events could incur high costs for the company and render the project unprofitable, yet the firm aims at a 30% revenue increase. This would also ruin the company’s rapport with the client and create a negative reputation for the company. Not to mention, the firm would not realize the 35% increase in market share objective. This risk poses a significantly high probability of occurrence; thus, the execution of a mitigation plan is essential. This strategy would entail the identification of technological innovations currently in incubation and implement them. Furthermore, the firm could partner with highly innovative tech firms to ensure they utilize the latest hardware and software inventions. The expiration date of this risk would occur when SuperPacks delivers the project to the U.S. Army, as they would not be under the firm’s control.

Resource Risk

SuperPacks faces resource risk that manifests in skilled expertise and financial requirements. The project calls for an experienced and skilled workforce due to its technicality. The firm’s current expertise may be inadequate to meet this project’s human resource requirement. This scarcity may cause the firm to outsource additional labor in the execution of the project. Not to mention, the quality of the product may be adversely affected in the event of the recruitment of inexperienced and unqualified personnel (Turner & Downey, 2009). This project requires significant funding that might be unavailable to the firm. Subsequently, SuperPacks may seek external funding that may deem expensive to the firm, thus reducing its profitability. On the same note, inadequate monetary resources may cause the firm to outsource low-quality parts and components in production. Costs associated with this risk include the expensive cost of capital and the low quality of the product (Wysocki, 2011). The mitigation plan for this risk is establishing the project’s funding and human resource requirements at the onset. The organization can effectively plan to mobilize these essential resources through proper forecasting. The expiration date for this risk would occur after strategic planning, which would lead to the successful completion of the project.

Scheduling Risks

SuperPacks faces scheduling risks in supplying and delivering the backpack product with a built-in refrigeration pouch and radio module. This risk arises from delayed lead time, unexpected shortages of raw materials and works in process parts, poor strategy, unexpected price increases, and ambiguous client specifications  (Wysocki, 2011). Delays in lead times may occur due to supplier error, especially during an unexpected rise in product demand. The unexpected shortage is even worse and may disrupt the project’s operation. Unpredicted price increases may hinder SuperPacks from inventory acquisition due to inadequate funds. Poor strategy stems from selecting the wrong technology and adopting bottlenecks in the supply chain (Kerzner, 2017). Costs arising from this risk include delayed delivery which may result in lawsuits from the client in the worst cases. Lastly, ambiguous technical specifications may make the scheduling of this project cumbersome and may hinder the effective mobilization of resources. This risk has a high probability of occurrence and should be mitigated. Selection and appraisal of several suppliers is the most effective mitigating plan for the risk of delayed lead times. On the same note, the firm could establish collaborative relationships with suppliers to ensure they top the vendors’ priority list. In mitigating hedging, SuperPacks should store its raw materials and components inventory to avoid production disruption. As for poor strategy, the firm could implement an effective supply chain by utilizing the Work Breakdown Structure (WBS) strategy. In mitigating ambiguity arising from poorly designed specifications, SuperPacks should communicate with the U.S. Army procurement department for clarity. The delivery of this product to the U.S. Army marks the expiration date for the mentioned risks.

In conclusion, the main risks facing the supply and delivery of the backpack product with a built-in refrigeration pouch and radio module to the U.S. Army are; technology, resource, and scheduling risks. They all exhibited a high probability of occurrence. Technology risk is caused by the possible invention of advanced parts and components and is mitigated through collaboration with high-tech firms. Resource risk occurs due to an inadequate skilled workforce and finances; this can be mitigated through effective planning. Lastly, scheduling risk arises from delayed lead times, shortage of the product, and ambiguous specifications, and could be solved through supplier collaboration and communication with the user department.

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References

Kerzner, H. (2017). Project management: a systems approach to planning, scheduling, and controlling. John Wiley & Sons.

Turner, J. R., & Downey, A. B. (2009). handbook of project-based.

Wysocki, R. K. (2011). Effective project management: traditional, agile, extreme. John Wiley & Sons.

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Risk Matrix

Competency

• Analyze approaches to project risk management techniques used to assess and control project risk.
  

  Risk Matrix

Scenario Information

You are assuming the role of the project manager for a company called SuperPacks to provide a new backpack product with a built-in refrigeration pouch and radio module. Your customer for this project is the U.S. Army, Ground Forces, and Special Operations. As your team’s project manager, you will submit a project management report to your manager.

Instructions

As a project manager for this company, you are to analyze the risks associated with the project. Risks should be identified and defined as each risk’s cost, probability, impact, and mitigation plans. Below, you are to provide a risk assessment for the project based on the criteria and template provided.

• Identify and name at least three risks and name them (risk name).
• Determine the expected costs for each named risk.
• Determine the risk probability for each named risk.
• Include factored risk value
• Determine the risk impact on the project
• Provide the Risk Mitigation Plan.
• Provide the expected risk retirement date (when the risk is no longer a risk).