Risk analysis of new office building construction

Running head: PROJECT MANAGEMENT
Project Management: Week 2 Answers
Name of the Student:
Name of the University:

PROJECT MANAGEMENT1
1. Risk analysis of new office building construction
Risk Factors Probability Impact
Budget risks: There is over run of entire project budget
due to improper estimation of the budget against the
project activities.
Moderate Moderate
Schedule risks: There is delay in the project due to
addition to extra resources after the project is planned.
Moderate Major
Commercial risks: Due to low demand of the office
space, the market demand of that space is low as the
clients are not interested into the project.
Likely Major
Technical risks: There is incomplete design of the office
space due to which there is delay in the project
completion work.
Moderate Moderate
Resource risk: There are lack of availability of the
project resources as they do not have technical and
construction skills to work in the project.
Moderate Major
The risk analysis will be changed if there is high demand of the new office space as
then there will be high market value of the space and the clients will be interested to buy
the land.

PROJECT MANAGEMENT2
2. Qualitative risk assessment
Identified risk factors Likelihood Consequences Risk level
Key team members pulled off project High High High risk
Chance of economic downturn Low Medium Low risk
Project funding cut Medium Medium Medium risk
Project scope changes High Medium High risk
Poor specifications performance Low Low Low risk
Risk rating Likelihood
Consequence
Low Medium High
High Key team
members
pulled off
project
Medium Chance of
economic
downturn
Project
funding cut
Project scope
changes
Low Poor
specifications
performance
Table 1: Risk Matrix
Based on the information provided on the risk factors and likelihood, there is an
assumption on the consequences of the project and by the risk matrix, the risk level is also
identified.
3. Calculation of fully loaded cost of labor
The fully loaded cost of the labor is = Hourly rate * hours needed * overhead rate
= $ (35*150*1.55)