Risk Management in Project Planning

This assignment explores the concept of risk management in project planning, focusing on strategies for mitigating time, cost, and scope risks. It discusses the importance of risk management in ensuring project success, including the benefits of transparency with partners and regular scenario reviews. The assignment also highlights the need for proper scheduling, R&D, and continuous integration to minimize risks.

Project risk, finance, and monitoring

Table of Contents
INTRODUCTION...........................................................................................................................1
PART-A...........................................................................................................................................1
PART B............................................................................................................................................8
PART C: RISK MITIGATION PLAN............................................................................................1
REFERENCES................................................................................................................................5

INTRODUCTION
The report will include about the road construction project which explains about the
overall budget, benefits and drawback of the project. The report also includes the different type
of risks affecting the project and the principle of project management body of knowledge which
helps in effective accomplishment of the project.
PART-A
Overall budget of the project
North East Link is the biggest project of road transport in Victoria's entire history. They
focusing on fixing the missing link in Melbourne's freeway of network. The overall budget for
the project is $100 million for preliminary sites investigations, engineering works, environmental
and geotechnical studies, initial designs, and preparing a business case etc. is given by the
Victorian government. The overall budget will be targeted for expenses for the project. Th
Victoria government plans to build the missing link road network so that it can slash congestion
in Melbourne's.
Benefits/Advantages of project
There are many benefits of implementing the project that is establishing the link road
network and it will help in providing many befits and advantages which includes:
Slashing traffic and Travel times
 The link road will help in slashing the travel time between the Melbourne's north and
south east up to the 30 minutes.
 It will take around 15000 trucks off local roads a day,
 through new technology, traffic management will get better
 Seamless trips from Doncaster, ring wood to Melbourne's airport.
 Benefiting with the additional lanes on te eastern freeway which will leads to eliminate
some Melbourne's worst bottlenecks.
Creating walking and cycling connections
 This project helps in providing and delivering more than 25 k ms of new and updates
paths for walking and cycling.
 Benefiting walkers and bike riders by providing more signalized crossings and by
upgrading bridges(Fleming and Koppelman, 2016)
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 completing North east bicycle corrie which is an computer cycling route directs to the
city along with the Eastern freeway between the Chandler highway and Merri Creek,
Improving the public transport
 Project will help in implementing and establishing the new park and ride at Bulleen.
 Leads to build the Melbourne's first bus way along the Eastern freeway,
 It helps in improving the access and upgrading the car parking at Watsonia station.
Contributing towards the growth of the industry and the economy
 This project resulting in more employment opportunities that is they creating more than
10000 jobs.
 It accesses to 56000 more jobs opportunities for the workers of north east which
ultimately helps in improving their standard if living and lades to satisfactory of ether
needs and wants,
 Annul income $427 million boost from better freight connectivity,
disadvantages
 It leads to wastage of many resources including financial resources as large amount of
budget is passed for this project which affects the financial economy,
 jobs provided to the workers are temporary till the projects completed and after
unemployment will arise(Heagney, 2016),
 heavy cost incurred on building the roads, bridges, tunnels etc,
 Any misuse or inadequate utilization of result will lead to the great failure.
 Not utilizing the resources optimally and efficiently might cause damage to the public in
the future.
 It includes heavy cost of construction.
 It requires high skilled workers in given fields as any single mistake can cause danger to
the public health.
Project scope with reference to what is being builtKerzner and Kerzner, 2017
The project scope is to provide effective services by fixing the missing link in Melbourne's
freeway of network. the project having grate scope as it is ultimately benefiting the economy of
the nation and improving the infrastructure which helps people in their comfort and ease. It also
helps in slashing the traffic and travel time, slashing of traffic leads to easy and convenient
movement of road transport vehicles and will lead to avoidance of the accidents which are
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caused due to inappropriate road maps(Kerzner and Kerzner, 2017). It will lead to improve the
effectiveness s of public transport and also creating walking and cyclic connections. This will
help the people who used to prefer to walk and cycling then it will be convenient for them. This
project will lead to improve the infrastructure of the entire economy.
Project road map
PROJECT ROAD MAP PROJECT PHASES
1. Public consultant
2. Desk top studies
3. Map consultations
4. identification of the potential locations
and routes
Phase 1
Alternative site assessment
Preliminary screening
5. Public consultations
6. Environmental studies
7. Publishing alternative site assessment
report
Phase 2
Alternative site assessment
8. Public consultation Phase 3
Public consultations
9. announcing the project locations Phase 4
Selecting the preferred site locations for
Regional waste water Treatment plant. Orbital
sewer routes, Marine outfall
10. Environmental impact Assessment
11. Public engagement
12. submitting planning application for
approval
Phase 5
Application for the Approval to board
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Outlining of the budget and estimated cots
Budget for the given project
Particulars Amount($) in millions
Raw material 20
Preliminary expenses 5
Engineering work 20
Sites investigations 5
Preparation of business case 10
Wages to workers 20
Infrastructure for bridge and tunnels 20
TOTAL BUDGET 100
Estimation of the time required to complete the project
Task Name Duration Start Finish Predecessors Cost
Idea generation 1 day Mon
4/22/19
Mon
4/22/19 $10.00
preliminary Investigations 2 days Tue 4/23/19 Wed
4/24/19 1 $5.00
refining and analyzing of
options 4 days Tue 4/23/19 Fri 4/26/19 1 $4.00
selecting the best and
preferred options 7 days Mon
4/29/19 Tue 5/7/19 2,3 $10.00
setting budget 5 days Mon
4/29/19 Fri 5/3/19 3 $1.00
designing phase 3 days Wed 5/8/19 Fri 5/10/19 4,5 $2.00
Concept designs and 5 days Mon 5/6/19 Fri 5/10/19 5 $4.00
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Environmental impact
assessment
Detailed design 6 days Mon
5/13/19
Mon
5/20/19 6 $5.00
project inputs 8 days Tue 5/21/19 Thu
5/30/19 7,8 $12.00
Negotiating with suppliers
for raw material 10 days Mon
5/13/19 Fri 5/24/19 6,7 $16.00
Arrangement of resources 5 days Fri 5/31/19 Thu 6/6/19 9 $20.00
employment generation 7 days Mon
5/27/19 Tue 6/4/19 10 $20.00
Pre-construction activities 6 days Fri 6/7/19 Fri 6/14/19 10,11 $5.00
Awarding tender 3 days Fri 6/7/19 Tue 6/11/19 11 $3.00
organizing all the resources
available at place 4 days Wed 6/5/19 Mon
6/10/19 12 $4.50
Construction Planning 4 days Wed 6/5/19 Mon
6/10/19 12,9 $20.00
managing the resources 7 days Mon
6/17/19 Tue 6/25/19 13 $2.50
directing the workers 3 days Mon
6/17/19
Wed
6/19/19 13,14 $9.20
controlling the activities 2 days Wed
6/26/19
Thu
6/27/19 15,17 $2.00
Project output 1 day Tue 6/11/19 Tue 6/11/19 15,16 $3.00
sustainability( maintaining
infrastructure) 2 days Fri 6/28/19 Mon 7/1/19 18,19 $4.50
Completion of project
planning 1 day Tue 7/2/19 Tue 7/2/19 20,21 $2.00
Gantt Chart:
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Critical path analysis:Kerzner, 2018
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Identification of key elements of constructing the road
There are different elements o construction which are very essential in the complete construction
project which includes tunnel segment, bridge segment, Angle of crossing, speed breakers,
Kerbs, Grade separator, pedestrian crossing etc which are required to consider by the project
developer op that effectively and coefficient project can be accomplished and goals can e
achieved(Kerzner, 2018).
Angle crossing is the angle at which two roads cross each other should not to be an acute angle.
This is considered to be essential element as they should be aligned so that they meet at right
angles to each other and can avoid accidents and blockages.
Analyzing the funding mechanism of the project to derive the social benefit to provide
returns to its promotersKerzner, 2018
The Victorian Government is using many sources for funding the project so that they can
drive the social benefit and able to generate good revenue in order to provide return ti its
shareholders. Some sources of funding are :
Tender- In this source of funding mechanism government provides tender order to some private
limited companies in which they prepare the budget according to their criteria and target the
completion of the government project in order to earn great profit. This sources reduce the
workload from the government and all the project related work is performed by the company
who has relieved a tender offer
Government revenue- there are some sources through which government can earn revenue they
are imposing the taxes, charging high duty, excise and many sources through which government
can earn good amount of revenue, using the funding mechanism government is bale to invests
the money into the project for public welfare and public support(.Larson, and Gray, 2017).
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Equity shares- those companies who are benefiting from the new infrastructure prefer to pay for
it. The amount which government derives from these groups as directly proportionate to the
benefit they will gain. The large groups and companies somewhere helps the government in
investing in the public welfare project in order to earn good amount of return or profit,
Hence, thee are many sources through which government can finance or fund the project which
meets the demands of the people and which are launch for the public and social welfare itself.
Identification of the Key stakeholders
Top management includes the vice president, directors, divisional manger of the
company to whom the tender is being offered and delivered, they focus on directing the strategy
and development of the organisation,
The project team this team is basically made of the people who are dedicated to the
project or borrowed on part-time basis to accomplish the given project(Schwalbe, 2015). This
includes the project manager who directs the complete tasks to be performed and also the support
team which will accomplish and implement the task given
Manger is the person who plan, organise, directs and control the resources and activities of the
organisation in order to ensure that all the activities must directed toward the achievement of the
goal.
Peers are the persons who are at the same level in the company as the project team. They
have also different interest vested in the project, they have neither leadership responsibilities nor
the accountability for the success or failure of the project that company has undertaken.
Internal customers are customers or individuals of within the organization and who are
customers for the projects which meet the needs of internal demands, the customers holding the
power of accepting and rejecting the work if not offered effectively(Turner, 2016.).
Government- project management is certainly regulated by the government and it needs
to deal with all the regulations and departments/ the also include some level of government,
provincial, federal or international and they all are responsible to take care of the complete
project which ash been passed for the social and public welfare.
PART B
Identification of potential risk using qualitative and quantitative risk measures with
reference to the PMBOK principles,
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There are various risks associated with the project using qualitative and quantitative
measures which need to ascertain so to eliminate and hedge the position from the uncertain risk
which can cause severe loss.
Project Management Body of Knowledge (PMBOK) have basically the six principles of project
management.
Principles:
1.Vision and Mission. This principle focuses on setting the vision in order to achieve the
goal and mission to direct the activities in the direction of achieving the set vision for the project.
Cost and supply risk can be avoided as effective missions leads to preparation of the effective
budget which will help in avoiding the risk
2.Business Objectives.- objectives are required to set so that all the activities can be
directed or controlled ion effective and given direction to avoid the chaos and confusion and
objectives help the organization in achieving their target and goal set for the project
accomplishment.
3.Standards of Engagement-this means that who will be part of the management team,
what would be the rules etc. the operational risk can be avoided using these principles as
involving the people who are skilled and highly efficient can only involve in task of project
completion so that operational risk can be avoided, say financial risk and intellectual risk can be
avoided by effective and efficient management of all the resources especially financial resources
as construction requires heavy investment(Walker, 2015.).
4.Intervention and Execution Strategy- this includes the completion of the project
which also includes the gap analysis process to determinate the most suitable intervention to
resolve the issue. There are different quality management concepts which can be applied and can
avoid the risk of poor quality.
5.Organizational Alignment. This principle focusing on the success and sustainability of
the new initiative or process bought by this project, to achieve the organizational alignment
ongoing and effective communication must be employed so that risk of failure of the project due
to uncertainties can be avoided.
6.Measurement and Accountability- this principle focusing on the measuring the quality
of the scored project and reliability of the project so that it can finally communicate and-
implemented
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Risk matrix to assess the likelihood of potential risk
Risk
descriptio
n
Likelihoo
d
Impact Severity Responsib
ilities
Mitigatio
n action
Continge
nt action
Progress
on action
Financial
risk
Medium high low Project
manager
and
managing
director.
In order to
conduct
program
effectively
reserves
need to
maintain
so that all
activities
can be
handled
effectively
for
managing
the
resource(
Kerzner,
2018)
To make
better
communic
ation
between
members
so that
optimum
utilisation
of
resources
can be
done
Up-to20
days.
Intellectua
l risk
low high low Project
manager
and HR
departmen
t of
university.
Work
pressure
must be
reduced
and all
activities
must be
Effective
training
and use of
retention
strategies.
10days.
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divided
appropriat
ely. The
worker
must pay
equal
wages.
Operation
al risk
low high medium Project
manager
and all
other
departmen
ts.
The
appropriat
e
communic
ation
between
the all
departmen
t leads to
carry
better
activities(
Heagney,
2016).
With use
of making
better
coordinati
on for
effectively
performin
g the
operationa
l activities
12 days
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PART C: RISK MITIGATION PLAN
Financial risk
On basis of mitigating financial risk, it must lean on lien rights as it is for protecting
suppliers and contractors against financial risk on the particular project. Generally, these rights
get a sour reputation in industry causing suppliers and contractors to fear remedy. The contract or
credit agreement must be examined properly as in various aspects, organization has identified its
fate before furnishing materials and labour to site through virtue of agreement or contract was
signed. In the same aspect, the most important aspect for approach the issue with consistent
policy, The consistency in efforts would breed consistency in outcomes. If a thorough policy is
implemented and followed then there will presence of limited surprises in entire process. There
must be application of joint check agreement as this obligated some third parties for paying
company directly or with joint check to organization and its customer. Apart from this, most
important is that it always runs on credit as it is very censorious for having strong credit
practices. The credit of customer at beginning of relationship must be checked and monitored
throughout. This is very important that customers must have capability for repaying it.
Human resource risk
The risk could be mitigated through gathering data and analysis which helps in building
compelling case for aggregating this to map of enterprise risk. This will lead to reduce the
critical skills' shortage (Top eight HR risks, and how to handle them, 2019). The problem of
succession planning, there must be use of internal audits and discussion with risk committee for
attaining board's attention. The risk related to ethics and behaviour must be fulfilled by writing
code of conduct and establishing an committee of ethics. The risk related to intellectual property
loss or violation, the hiring vetting process must be reassesses and consideration of re-vetting
employees after set periods of times. The best advises to training line manager to observe the
information in secured manner and giving checklists for following it. Simultaneously, building of
culture of security as screen savers in offices must have presence of information related to
passwords and phishing.
Legal risk
The legal risk could be mitigated by complying with innovative environmental
regulations imposed through federal or state governments. The risk should be avoided by not
initiating and continuing activity which creates uncertainty (Martinsuo and Hoverfält, 2018). The

activity could be increased, is its consequence are beneficial and rid the source of the risk. In the
same series, likelihood must be altered along with risk consequence and sharing risk by
contracting or insurance. Apart from this, to manage legal risk policy and licenses must be
designed for attaining objectives.
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Supply of resources
The risk related to supply chain risk could be mitigated by following steps which are
evaluating and determining current risks of critical outlook and exposure of risk. This must
prioritize through probability and impact of risk through likelihood they could actually undertake
place. Then it must estimate the financials and brand effect on every event. There must be
development on contingency plans and initiating with likely and highest impact on scenario of
risk (Overcoming a Lack of Project Resources, 2019). The suppliers could impact the reputation
of organization and ensuring quality of goods of supplier be aware about treating employees,
sourcing materials and interaction with other partners. There must be conduct of due diligence
for purpose of ensuring supplier viability for long term perspective. There must be less reliance
on single source of products as this is highly desirable for sourcing through locations of low cost
throughout the world, but goods could not be delivered in timely aspect, so supply chain is
transformed vulnerable (Nonino and et.al., 2018). Further, reliable secondary suppliers must be
established in various regions for minimising risk.
Apart from this, be transparent with partners as information must be shared as it could be
like increased projections of sales, inclusion of partners in alterations in changes in product. It
will help suppliers with availability of the best product as per requirement. If there is drop in
forecast of sales, then let partners be aware which will lead to appreciate and strengthen
relationships. Lastly, scenarios of risk must be reviewed on regular basis along with
determination of supply chain.
Time risk
The risk related to time could be mitigated by proper scheduling as there should be
application of customised and agile project management. In simple words, management must
accept alterations which is major risk required to be dealt within projects. The change signifies
alteration in requirements, timeline, budget and other factor which takes decision for success.
The plans must be prepared with short term deliverables, maintaining small autonomous team,
effective manage communication and plan for dummy sprints for handling over runs (5 Ways to
Reduce Time and Cost Overruns in Projects, 2019). In the same series, it should perform
appropriate R&D and ensuring availability of consultant and application of continuous
integration with use of the best configuration approach.
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REFERENCES
Books and Journals
Fleming, Q. W. and Koppelman, J. M., 2016, December. Earned value project management.
Project Management Institute.
Heagney, J., 2016. Fundamentals of project management. Amacom.
Kerzner, H. and Kerzner, H. R., 2017. Project management: a systems approach to planning,
scheduling, and controlling. John Wiley & Sons.
Kerzner, H., 2018. Project management best practices: Achieving global excellence. John Wiley
& Sons.
Larson, E. W. and Gray, C. F., 2017. Project management: The managerial process. McGraw-
Hill Education.
Schwalbe, K., 2015. Information technology project management. Cengage Learning.
Turner, R., 2016. Gower handbook of project management. Routledge.
Walker, A., 2015. Project management in construction. John Wiley & Sons.
Nonino, F. and et.al., 2018. Project Management: Driving Complexity. PMI® Italian Academic
Workshop (Vol. 43). Sapienza Università Editrice.
Martinsuo, M. and Hoverfält, P., 2018. Change program management: Toward a capability for
managing value-oriented, integrated multi-project change in its context. International
Journal of Project Management. 36(1). pp.134-146.
Online
5 Ways to Reduce Time and Cost Overruns in Projects. 2019. [Online]. Available through
<https://www.cabotsolutions.com/2015/12/reduce-time-cost-overruns-projects>.
Overcoming a Lack of Project Resources. 2019. [Online]. Available through
<https://www.projectmanager.com/training/overcoming-lack-project-resources>.
Top eight HR risks, and how to handle them. 2019. [Online]. Available through
<https://www.hrmagazine.co.uk/article-details/top-eight-hr-risks-and-how-to-handle-
them>.
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