PM FPX 4060 Assessment 6

Adapting an Approach to Quantitative Risk Analysis for a High-Risk Project

One of the prime tasks of a Project Manager (PM) is to observe and evaluate the likely risks that will influence the achievement of a project. Quantitative Risk Analysis (QRA) assumes a crucial function in such a situation because it allows a forecast of the ways in which the risks are going to influence the scope, schedule, and budget of a project. This assessment helps to provide a better understanding of the performance of the project and the likelihood of its success or failure. The QRA process involves comparing the cost and time estimates of the project team with lessons learned and historical data of previous projects. In addition, interviews with stakeholders and subject matter experts (SMEs) can also be utilized to identify risks based on their perception. The capacity to identify known and unknown threats is significant for the project manager to provide successful project delivery (Thamhain, 2013).

In addition, a SWOT (Strengths, Weaknesses, Opportunities, Threats) analysis helps in analyzing potential threats, and keeping a risk matrix or log is critical. This document should be updated from time to time and contain details on identified risks, their complexity, response categories, causes, measures of mitigation, and roles and responsibilities assigned. In accordance with these risks, a project manager can identify factors that would delay the project. For example, in the CapraTek Alfred! Personal Security Device project, Software Architect Brandon Matthews recognized insufficient staff as one of the potential risks that would lead to delays and scope creep and eventually jeopardize the project. Other risks that were recognized included software compatibility, QA and test problems, product reliability, and competitive pressure by partners manufacturing similar products (CapraTek, n.d.).

PM FPX 4060 Assessment 6:Risk Audit Report Strategy

Risk reviews or audits help establish and evaluate the project risks irrespective of their extent. Risk audits are carried out by project managers at predetermined periods to keep the project within budget and schedule. By doing so, risk auditors and project managers can assess potential risks by conducting team interviews, creating a scoring table, and establishing critical success factors to be able to measure the health of the project. The gathering and analyzing of evidence result in recommendations for improvement. Follow-up audits must also be conducted to ascertain implementation of such suggestions and whether further adjustments are required (Wooten, 2020).

In the case of CapraTek, SME interviews indicated a few areas that were to be enhanced in risk assessment in the future. For instance, there was an issue of weak innovative market analysis and risk that Alfred! Personal Security Device’s market already existed. Although there was enhanced communication across teams, some specifications of the projects were still not clear, thus causing delays in product release (CapraTek, n.d.).

Best Practices in Preparing for High-Risk Tasks

Successful management of critical tasks begins by examining analysis within the early segment of the project. Project leaders need to notice potential weaknesses, strengths, and opportunities as development goes on. Known risks and unknown threats—technology, commercial, managerial, and exterior ones—have to be determined and incorporated within the project scheme. Interviewing teams at an early stage, as well as during the duration of the project, identifies risk. The risks should be monitored regularly and documented in a risk register to be reviewed continuously.

For CapraTek, SMEs recognized some of the highest risks to include limited resources, communication breakdown, lack of market analysis, and customer support problems after delivery. While some of the risks were dealt with, others still existed, and this meant that a risk audit by an external auditor would be less subjective and assist in removing existing problems (CapraTek, n.d.).

Proper risk management is vital to project success. Neglecting early detection and control of high and low risks may lead to failed objectives or project failure.