Essay about risk analysis of a project

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Task 5 - Risk Analysis

Project Risk Management Definition

The project management team has not undertaken a similar medium-size project like the charity fashion show before; therefore risk analysis stage will require crucial attention. It is important to consider all the possible risks both internally from tasks within a project and those risks that may arise externally from the project without any warning. It is vital to deal with the risks, as they can be costly in terms of cost and time. In order to successfully complete risk analysis, a risk analysis strategy should be implicated which includes identifying all the possible risks and how to deal with them.

Identifying the risks

The project management team has made its first priority to identifying the possible risks that may affect the charity fashion show. As it is the first time the project management team have carried out a project like this, they found great help from other pervious companies and organization that have had problems and experiences in projects like this. Also a project meeting was conducted between the project managers to identify and discuss all possible risks.

Possible risks

The list below shows eight of the possible risks that the project management team has identified.

1. Kylie Minogue changes her mind and does not attend the event.

2. The budget set for the start up costs for the project may not be enough as more and more costs are reveling.

3. The venue (Business Design Centre) is located in the heart of London; any unforeseen accidents/road works may cause delays in starting the fashion show. Also have to keep in mind the closing time for the Business Design Centre is at 6pm.

4. In accurate estimates of ticket sales and ticket pricing.

5. Technical equipment fails to work on the event day.

6. Main method of transport around London is by the underground (tubes). Any tube delays may also lead to a late start of the fashion show.

7. Unforeseen illnesses and no-show of any member of the project management team will have a huge impact on the event, as they are responsible for fulfilling their duties. For example, Murtaza’s responsibility consists of managing series of events that will take place during the fashion show.

8. Delays in response from sponsors. If they fail to receive the contract or delay in signing it and sending it back may cause last minute problems as replacements will be hard to find.

Risk Assessment

The second stage of risk management process consists of risk assessment. At this stage, the project management team decided to rank the risks according to the probability of their occurrence and the impact they are likely to have. It is important to consider the possible causes and effects of all the risks.

A matrix for qualitative risk assessment is used to consider each risk and its likelihood of occurrence for the relative scale of impact it can have on the charity fashion show project.

Assessing risks for potential of impact and chance of occurrence

Risk ID refers to the 8 mentioned possible risks under the identifying risks section.

Risk ID
Impact
Occurrence
Risk Total
Level of Risk
1
3
3
9
High
2
3
3
9
High
3
3
2
6
Medium
4
3
2
6
Medium
5
2
2
4
Medium
6
2
1
2
Low
7
2
1
2
Low
8
3
2
6
Medium

Risk Total = Impact x Occurrence

Failure mode and effect analysis (FMEA)
This method of analysis considers the possible risks and what may cause them and helps make a prediction on the possible effects they are likely to have on the project. Also an additional columns have been added to show at what stage the risk may occur and the recommended action which should take place. The table below shows the FMEA of the eight possible risks mentioned, but does not give them ranking according to importance or measurement.

ID
Item
Failure Mode
Cause of Risk
Effect
Risk occurrence (Project Life Cycle)
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