Risk Management Analysis

This document discusses the implementation of risk analysis for ABC Company's government contract. It covers decision making using expected monetary value and decision tree.

Risk Management Analysis
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Table of Contents
Question 1....................................................................................................................................................................................... 3
Introduction to problem............................................................................................................................................................ 3
Decision tree without EMV.......................................................................................................................................................3
EMV with decision tree and discussion....................................................................................................................................3
Final decision and discussion.....................................................................................................................................................3
Byes Rules problem....................................................................................................................................................................3
Byes rules outcomes and discussion..........................................................................................................................................3
Question 2....................................................................................................................................................................................... 3
Question 3....................................................................................................................................................................................... 4
Question 4....................................................................................................................................................................................... 4
Question 5....................................................................................................................................................................................... 5
Reference........................................................................................................................................................................................ 6
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Question 1
Introduction to problem
The main aim of this problem is to implement the risk analysis of ABC Company and
provide 10,000 special computers on the Government contract using the computer aided design.
By analyzing the risk management, they can perform three bid ways and then analyses the risk
for which they can follow the methods on expected monetary value and decision tree of the
company management system. The objective of this problem is to find the complex computers.
ABC's auction decision is complicated by ABC's current working on new ways of making
computers. If this process works successfully, computers can significantly reduce. However,
there are a few possibilities that the new process will be more expensive than the current
production process. Unfortunately, ABC actually cannot use the cost of the new process for
bidding the produce per computer and the same will be investigated.
Decision tree without EMV
The current production of the ABC process cost is 8000 dollarsper computer. The new
manufacturing process of risk cost and probability is 0.50, 0.20 and costs $ 5000 and $ 7,500.The
ADC is 100,000 of the auction for the total cost. Determining the value of anticipated guide to
probability 0.25, the cost of risk is detected at the risk from the chart above $ 8,500, $21,625
USD, 31,125 USD, 24,625, but this would not be appropriate.All these risks are not going to
occur all together, some of them may happen, some of them may not. The risks that occur will be
added to their EMV domain, and the risks of using the money from this pool. Therefore, all risks
identified in the above case will add value to $ 77,375 for the budget.
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EMV with decision tree and discussion
The use of anticipated currency appraisal formula can be used more frequently when
evaluating the risks associated with the dangerous legacy analysis. While there are many options
when used in their own customization analysis, there are important guidelines for determining
the best program when there is a perceived uncertainty of each option.ABC Company offers
10,000 specialized computers in the government contract. ABC Company has already made the
current production process at the potential auction for this contract. Now calculating the expected
cost value and finding the decision tree is denoted by finding the expected monetary value, they
can be used for the mango carol simulation software on the statistically techniques in ABC
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company of the quality issue risk management that specified and average calculation of the
values of the outcomes and find the submitted bit per computer of the future scenarios.
The probability of the cost is=0.25, 0.50, 0.25
Impact cost is=$5,000, $7,500, $8,500
Expected monetary value= probability*impact
=0.25*5000+0.50*7,500+0.25*8,500 =7,125
The expected money value of the risk for the event is 0.25.
These three relatives of the expected monetary value analysis, benefits from the risk planning
management. It gives the average outcome to the identified undertrain events and this helps to
calculate the contingency reserve from the best result decision.
Final decision and discussion
Expected cash rating concepts work well to calculate the emergency reserve when you expect
dangers, because you can identify risks and coincidental reserve spreads at all risk.If you detect
fewer risks, there is not enough space, your presence may be wounded very quickly, or it may
not be enough to cover a significant risk (Dionne, 2013). Positive risks play a significant role in
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accidental accounting. You need to identify positive risks in the expected value forecasts. ABC
Company of the forecast value is the loss of the company’s profit because it occurs the risk in the
manufacturing process of the total cost which is 1, 00,000 and the profit value is 77,345 of the
bid per computer.
Bayes Rules problem
The Bayes rule of theorem can be used for the type of Drug usage that includes for
athletes. Drugs calculate the result as either positive or negative. Support the finding of the result
is positive and this is displayed on the value which surely says he is a drug user. Suppose the find
of the result is negative and the display of the value says he is not a drug user by using Bayes
rule analysis. The T+ and T are denoted as positive and negative result. The Bayes rule can be
denoted as the D and ND variable.
Bayes rule outcomes and discussion
The Bayes rule of the outcomes of the risk management can be analyzed for each step asathlete
is tested for drug usage and if is positive or negative.
= (0.07)(0.03)
( 0.07 ) ( 0.03 ) +( 0.05)( 0.07)
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=0.0035
The find the Bayes problem and the using the parameters on P(T+|D+) or P(T-|D-). Of the
athletes and drug users. For simplicity, let's assume we know the athletes use drug users.
Prevalence P (D+) (we often have a lot of data on this).
Suppose 3% athletes were tested, and 7% of them were tested positive. Suppose 7% athletes
were drug users subject were tested and 0.0035 of them tested negative. Finally, suppose 0% of
athletes use drugs (Roeschmann, 2014).
Question 2
The Pigskins company to provide football production and to find the optimization of the decision
making models dependence of the demand and production schedule for the inventory holding
costs. Let us consider the risk analysis of the given demand and find the minimum of the total
production which can be different to occur in the organization. Finding the total inventory
control of the holding cost to be specified in the demand value is equal to the expected for the 6th
of each month as the inventory control organization. The only requirement is that all demands be
met eventually by the end of the month. The demand and production scheduling is changing the
optimal cost and to find the production scheduling of the entire product inventory control will be
investigated.
The pigskin company in the initial expected the month to have value 6which is equal to the
demand value on the time. The pigskins company has the requirement for the risk management
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identification and to develop the production schedule of the minimized of the total cost value of
the inventory management holding cost of the company. To find the 6 month values optimal cost
annual demand value is 17592.49 which is equal to the month 6 of the 17154.55 but both values
are equal to the inventory control. Selling the footballs production of the inventory control for
the unit cost is 98 per unit and the total cost of the ordering value is 2000 units. The
identification of the risk analysis and changing the total cost optimization value is 1547.11 and
specified the occurring of the total risk for the cost values is 45484.91. Any date in the first 5
months should be completed without a delay of one month, while 6 months value per month
value is 17423.88.The Pigskin Company for calculating the first 5 month total demand value for
the unit cost is 17154.55 and which is partly equal to the month 6 unit cost which is 17473.88
and calculating the total annual value is equal to 6 month values of the total cost.
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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
15,000
15,500
16,000
16,500
17,000
17,500
18,000
18,500
demand
Continental offers long-term demand providers to provide continuous orders with a series of
contracts in volume production, which consist of less than 6 (six) months of production. This
may be a rolling delivery table or other predictive information.
The issuer announces the current and predictive assessment for the contracts. Requirements for
the current demands and the estimates are for up to 6 months which will require the Continental
Receipt Date (the date of the contract in the Continental Institution) and the Quantities Contract
Products at Continental Delivery Address (Consumer Point). Delivery Schedule (also known as
Release) Supplier advises issuing a significant contract for a specific date and time specified by
the particular Continental location (the Continental Command based on minimum packages).
The supplier uses the delivery schedule for continental locations according to the date and
quantity specified in the delivery schedule.
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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
producti on schedule
Dmand Deseasonalization
Estimated Deseasonalization Demand
The rating is 6000 in the linear proportional field with a fixed value of deviations from defined
min / max ranges. If the current stock level is less than 30% less than or less than 70% exceeds
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the maximum limit, SCM performance is estimated at 17240.64. The monthly outcome of the
delivery capability is the combined image of the 6 month scale of this risk management
Question 3
Gulberg is a small family in the United Arab Emirates. It produces tools that are aimed at
increasing the demand primarily for tourists coming to the golf course in the Gulf region. They
have decided to prepare two new products: a medium price golf bag and for a higher market, the
highest golf bag. The company's products have been provided for its international customer base.
The operation of the Gulberg company are denoted as cutting, dyeing, sewing, finishing,
inspection and packaging for the demand for risk analysis management. The objective of this
company is to find the feasible region for the maximum standard deviation it will be
investigated.
Column1 Column2 Column3 Column4 Column5 Column6
department cuting and
deying
sewing finishing insepection
profit $ 10 $ 10 $ 10 $ 10
Labor/unit(hours) 630 600 780 135
Time/unit(cost) 0.63 0.6 0.78 0.15
monthly demand 12000 20000 9000 10,000
month workload 10000
month production
cost
1.4
production
unit/month
12000 20000 9000 10,000 51000
monthly profit $
1,20,000.00
$
2,00,000.00
$
90,000.00
$
1,00,000.00
$
5,10,000.00
7560000 12000000 7020000 1350000 27930000
Question 4
The methodology model that can used for to find the each activities of the duration and identified
the dependence on the risk factors. The analyzing the risk factors which is used for the
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hypothesized on the estimation duration and testing on the influence of the each stages on the
project duration of the work estimation. The risking factor of the risk management they can used
to the identified the accuracy of the estimation on the practical application of the method of risk
management projects estimation. The historical data of the risk management can be used for the
accurate record of the construction sites.
Question 5
The duration of the proceedings were also discussed in the proposed manner of variations that
are dependent on the risk factors. There are a The series of the activity of on the estimation of the
project duration to identified the risk factor on the company project that can differ from one
activity to another incomplete designing of the project duration estimation, labour productivity,
failure equipment’s of the risk condition on the artificial obstruction on the landsides
constructors.. The goal of the current research is to create a system that accurately modifies the
process dependence and calculates the project period accurately using the risk management
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approach. A simulation model is formatted and designed to perform experimental performance.
To achieve this, you have to do the following tasks: Detecting risk factors for conducting
interviews with variables and contractors using literary studies; Identify any influence between
their influence and their impact on action variations by conducting similar risk factors and
studies; To model for the Carlo simulation and to create a computer-based simulation model
based on risk factors; Try to check this and test the model.
The quality model of the risk factor that can specified the total number of the project duration
estimation and find the all risk factors on uncertainties significant. Compared to Monte Carlo
Simulation using the beta distribution for the model performance variant is compared to the
performance of the operating system. The minimum period of the project will end 57 days and
the maximum period of the project has been completed from 94 days. The pessimistic value that
can used for the project estimation of the standard duration that can specified the 78.7 days and
0.115 days of the project duration will be completed on the around 80% and analysis the number
of days is 74 and 94 days to completed the projects on the risk factors duration will be occur has
been conducted.
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Completing the project duration of the process of the risk analysis is,
Possibility of the project duration is,
The result of the set of experience designed to demonstrate the effect of varying certain risk
factors while keeping the rest fixed. The object is to examine the stativity of the project towards
certain risk factors. The soli risk management of the project duration that can used for the
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distribution of the estimation project duration to occurs and the completed the projection
duration is reduced in the further. The analyzing of the random number risk factors to be
specified the soli and weather risk factor on the excepted productivity varied.
A simulation model is formatted and designed to perform experimental performance. To achieve
this, you have to do the following tasks: Detecting the risk factors for conducting interviews
with variables and contractors using literary studies; Identifying any influence between their
influences and their impact on action variations by conducting similar risk factors and studies; To
model the model of the Carlo simulation and to create a computer-based simulation model based
on risk factors; Try to check and test the model which will be completed.
Reference
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Dionne, G. (2013). Risk Management: History, Definition, and Critique. Risk Management
and Insurance Review, 16(2), pp.147-166.
Roeschmann, A. (2014). Risk Culture: What It Is and How It Affects an Insurer's Risk
Management. Risk Management and Insurance Review, 17(2), pp.277-296.
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