Professional Documents
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MB0033 PM Complete
MB0033 PM Complete
Set 2 MB0033
1. How can risks be prioritized in a project management?
Give any suitable example.
Risks are those events or conditions that may occur and whose
occurrence has a harmful or negative impact on a project. Risk
management aims to identify the risks and then take actions to minimize
their effect on the project. Risk management entails additional cost.
Hence risk management can be considered cost-effective only if the cost
of risk management is considerably less than the cost incurred if the risk
materializes.
Risk Analysis
The first step in risk analysis is to make each risk item more specific.
Risks such as, “Lack of Management buy-in,” and “people might leave,”
are a little ambiguous. In these cases the group might decide to split the
risk into smaller specific risks, such as, “manager Jane decides that the
project is not beneficial,” “Database expert might leave,” and “Webmaster
might get pulled off the project.”
The next step is to set priorities and determine where to focus risk
mitigation efforts. Some of the identified risks are unlikely to occur, and
others might not be serious enough to worry about. During the analysis,
discuss with the team members, each risk item to understand how
devastating it would be if it did occur, and how likely it is to occur. For
example, if you had a risk of a key person leaving, you might decide that
it would have a large impact on the project, but that it is not very likely.
In the process below, we have the group agree on how likely it thinks
each risk item is to occur, using a simple scale from 1 to 10 (where 1 is
very unlikely and 10 is very likely). The group then rates how serious the
impact would be if the risk did occur, using a simple scale from 1 to 10
(where 1 is little impact and 10 is very large). To use this numbering
scheme, first pick out the items that rate 1 and 10, respectively. Then
rate the other items relative to these boundaries. To determine the
priority of each risk item, calculate the product of the two values,
likelihood and impact. This priority scheme helps push the big risks to the
top of the list, and the small risks to the bottom. It is a usual practice to
analyze risk either by sensitivity analysis or by probabilistic analysis.
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In the probability analysis, the frequency of a particular event occurring is
determined, based on which it average weighted average value is
calculated.
Each outcome of an event resulting in a risk situation in a risk analysis
process is expressed as a probability. Risk analysis can be performed by
calculating the expected value of each alternative and selecting the best
alternative.
Ex : Now that the group has assigned a priority to each risk, it is ready to
select the items to mange. Some projects select a subset to take action
upon, while others choose to work on all of the items. To get started, you
might select the top 3 risks, or the top 20%, based on the priority
calculation.
Determine scope of the risk session. Select the team and moderator. The
moderator explains the risk process to new team members. Identify risks
(potential future problems). Brainstorm areas of risk, e.g., Weak areas
such as unknown technology. Things which are critical are extremely
important to the effort. Such as the timely delivery of a vendor’s
database software, creation of translators, or a user interface that meets
the customers’ needs. Identify things that have caused problems in the
past, such as loss of key staff, missed deadlines, or error-prone software.
Remove invalid or irrelevant.
• Analyze the risk – Use any of the available methods to analyze the
risk. Software may be used for the purpose of analysis.
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• Plan to mitigate risks – Select the most important risk issues, such
as the top 2 or 3, or top 20%. Brainstorm on actions that could be
taken to reduce the likelihood of the risk item occurring. Brainstorm on
actions that could be taken to reduce the impact if the risk item does
occur. Decide which actions to pursue. Select a person to be
responsible for each action chosen. Document the information in the
risk management plan.
In a team the maxim that all members will do well to remember is “Learn
to appreciate the problems of others, and some others would appreciate
yours”. It is therefore important that in a business environment,
particularly in Project Management, efforts to evolve solutions jointly
have great benefits, both for the teams as well as the organisation. The
top management has the responsibility of encouraging such a culture to
develop team work to healthy inter-personal behaviour. The following are
the main characteristics of inter-personnel behavior:
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• Motivation of others through efficiency and meticulousness, rather
than urging and exhibiting dependency
• Putting team goals ahead of individual targets.
Types of Review:
It is very easy for projects to go astray, because most of the activities are
not repeated. Learning will have to take place on the first task. This is
where the competent Project Manager becomes important. Instructions
will have to be clear and the progress kept in constant purview with
reference to milestones.
The reviews are generally divided into four types which are conducted at
different stages of the project.
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• Finding out the feasibility of the project and helping management
team to take a decision based on this initial Review.
• Checking if all the necessary activities were done before presenting a
customer the proposal or solution
• Checking if all the formal agreements and procedures were formally
accepted and reviewed between the customer and the project delivery
organisation.
• Finding out the deviation and allowing elbow room for changes in the
action plan for improvement.
The objectives sought to be achieved and the methods which are adopted
and the activities that are going to be undertaken i.e. the process include
the following steps:
Preparing and maintaining a set of activities and the workflow that is to
be followed and identifying business areas responsible for different stages
in the above;
• Making sure that the priorities that the above generate are relevant
and the projects are run on the basis of their impact on the
business as a whole;
• Structuring the programme so that the responsibilities and roles –
at both programme and project level – are acceptable to both the
top management and managers;
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• Planning the various points of review between various phases of the
projects.
The process has to incorporate all the important aspects which are to be
addressed during implementation and management of the projects. It is
important to identify all factors and incorporate resources – men,
materials, technology and time – so that their provision can be planned.
Projectised Organizations
This is one of the various models of organizations, which enterprises
adopt to run their businesses depending on the policies they follow, the
opportunities they want to exploit and the constraints that the
environment forces on them. Most organizations follow some sort of
‘projectisation’ of their activities – be it manufacturing, development of a
product, research, entering a market, acquiring of another company,
training programmes, setting up a new plant etc. In some situations they
find it advantageous to treat a set of activities requiring resources of
different kinds for short periods to reach a particular stage. They call that
a project. Projectised operations have in them some are all of the
following objectives, so that this business model to be useful.
• Accommodate discrete projects as a group in certain organizational
units to facilitate monitoring and controlling performance levels at
various stages.
• Assign priority of divisional management efforts based on Pareto’s law
backed by statistics or rules of thumb for prevention of problems or
profit growth on a group of projects in hand.
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• Facilitate project resource assignment and subsequent adjustment
especially human and information resources among the various
projects.
• Enumerate, evaluate and implement various procedures of
standardization in the form – tables, charts, manuals, templates with
the abundance of data that get generated across projects. Analyses of
data help in identifying opportunities of making changes in similar
projects.
• The project management capability can be enhanced – perhaps with
the help of the PMO, by setting objectives and measuring them with
success achieved. Each project can be measured for its maturity level.
Enhancement of the levels of different projects does become a
motivational factor for performance enhancement. A system of
internal benchmarking gets initiated almost automatically resulting in
highly efficient organisation as a whole.
The principles of Project Management can be extended to various
traditional operational type units.
The main differences between the traditional and project approach are
mentioned below. Here, we would like to emphasize that no one approach
can be considered the better for all businesses or at all times for the
same business. However, many organizations have found the project
approach worth giving a try to improve productivity.
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1. What is the significance of reviewing ROI? Explain in
detail.
Any project that has developed a business case is expected to refresh the
ROI at each key project decision point (i.e., stage exit) or at least yearly.
For the Project Management Review, it is recommended that the project
leader replace the text on the ROI document through –
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its life-cycle that adds a new site or undertakes an enhancement or
technology refresh that reaches the cost threshold established by
Standard will need to satisfy capitalization requirements. It requires all
agencies to capitalize items acquired or developed for internal use if the
expected service life is two or more years and its cost meets or exceeds
the agency’s threshold for internal use software. The standard requires
capitalization of direct and indirect costs, including employee salaries and
benefits for both Federal and Contractor employees who materially
participate in the Software project. Program managers are considered to
be the source of cost information for internal use software projects. If
capitalization data is collected for the project in the future, the project
would be expected to calculate and track its ROI.
Base line:
Baseline data is basic information gathered before a program begins. It is
used later to provide a comparison for assessing program impact.
• Tracking Progress
After creating a baseline, if the project has begun, it is necessary to enter
actual dates that tasks are being completed and the resource utilization
used to complete them. Again review different views and the cost and
summary tables before proceeding to the next section. Return to the
Entry view of the Gantt chart before proceeding.
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• Balancing Workloads
At times people and equipment can become assigned more work than
they can complete in normal working hours. This is called over allocation.
Project can test for this condition and reschedule (or level) their workload
to accommodate completing tasks during a normal day.
• Monitoring Variances
After a baseline has been established and the project has begun, it is
desirable to determine if tasks are being accomplished on time and /or if
cost over runs are occurring.
• Creating Reports
Project has many different built-in reports and has the capability building
custom reports and exporting data to other MS Office applications for
integration into other reporting venues.
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d. Maximum micro structuring – Splitting of the Product Modules further
into much smaller entity identifiable more through characteristics
rather than application Features. Approach is through Standardization
of these Microbial Entities even across Multiple Modules. Application of
these Microbial Entities to rest within multiple Projects or Products or
even as add-ons suit belated Customer Needs.
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