Project Management - Risk Management Planning

Unit11Group1Submission_v5.docx

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Part 1 – Risk Management Plan (RMP)

Risk strategy. The general approach to manage risk on this project will be to identify as many risks as possible early on the project. To do this, we’ll first determine which are the areas that could present a risk from the activities carried out for each. From there, risks will be identified, categorized and prioritized. We will determine the probability of occurrence and impact of each, and then plan an appropriate response accordingly.

Roles and responsibilities

· Steering Committee The steering committee includes the sponsor of the project in this case is Dr. Bill Mattes and the Harrisburg University Management. The responsibility of the steering committee is to review the risk register, risk management strategies to be able to provide clear direction the project team.

· Project Manager Virat Kohli, is the project team leader and his/her responsibilities would be to develop the RMP, schedule risk identification sessions, develop strategies to manage the risk identified, provide updates to the steering committee on the risk register each month as directed by Dr. Mattes.

· Project Team Members of the project team includes but not limited to, head of the security, live band manager, event site manager, and the caterer. Their responsibility is to assist Virat Kohli in implementing the project with minimum number of risks going unidentified and unaddressed.

Funding. A total of $500 have been allocated to risk management. These funds can only be used as follows:

· Known Unknowns A total of $200 can be allocated to the contingency reserves, these are the risks we know, that we don’t know like power shortage, shortage of food etc.

· Unknown Unknowns A total of $300 is being allocated to the management reserves for the risks that have not been identifies yet but may get uncovered while executing the project.

Timing. Defines when and how often the Project Risk Management processes will be performed throughout the project life cycle, and establishes risk management activities for inclusion into the project schedule. Zhiqi

Risk categories – Risk Breakdown Structure (RBS)

RBS LEVEL 0	RBS LEVEL 1	RBS LEVEL 2
Sources of project risks during the planning phase	1. Management Risks	1.1. Senior management requirements
		1.2. Guest list
		1.3. Event promotion
		1.4. Schedule
	2. Budget Risks	2.1. Budget
		2.2. Ticketing
		2.3. Sponsorships
	3. Logistics Risks	3.1. Venue
		3.2. Alcohol license
Sources of project risks during the executing phase	4. Management Risks	4.1. Attendance
		4.2. Guest behavior
		4.3. Food catering
		4.4. Alcohol consumption
	5. Logistics Risks	5.1. Entertainment
		5.2. Facilities management
		5.3. Technical equipment
		5.4. Security
	6. External Risks	6.1. Weather
		6.2. Access to venue
		6.3. Neighborhood
Sources of project risks during the closing phase	7. Budget Risks	7.1. Venue conditions
		7.2. Vendors

Stakeholder risk appetite. There are two main areas to be identified with regards to the senior management risk appetite: budget and schedule. The senior management has specified that:

· Budget the total budget for the event is $20,000, from which $500 should be used for risk management. There’s a high tolerance for risks when it comes to the budget.

· Schedule the event should be planned and executed in 6 months, and there is no tolerance for the tam to go out of schedule. The event date can’t be change.

Definitions of risk probability and impacts

Project Objective	Very Low/0.05	Low/0.10	Moderate/0.20	High/0.40	Very High/0.80

Cost	Insignificant cost increase	<15% cost increase	25% cost increase	50% cost increase	80% cost increase
Time	1% time increase	2% time increase	5% time increase, major concern	7% time increase, need HU management approval	No event
Safety & Security	Very few concerns	Significant concern of safety	Alert security manager	Put the event on hold	No event
Sponsorship secured	90% sponsorship; Insignificant cost concern	70% sponsorship; offline approval from Dr. Mattes for additional funds	60% sponsorship; Dr. Mattes reviews additional cost and get approved from high level management	40% sponsorship; high level management with HU Dean to review additional costs	20% sponsorship; sponsors, possibility of cancelling the event

Probability and impact matrix. Described in Section 11.3.2.6. Prioritization rules may be specified by the organization in advance of the project and be included in organizational process assets, or they may be tailored to the specific project. Opportunities and threats are represented in a common probability and impact matrix using positive definitions of impact for opportunities and negative impact definitions for threats. Descriptive terms (such as very high, high, medium, low, and very low) or numeric values can be used for probability and impact. Where numeric values are used, these can be multiplied to give a probability-impact score for each risk, which allows the relative priority of individual risks to be evaluated within each priority level. An example probability and impact matrix is presented in Figure 11-5, which also shows a possible numeric risk scoring scheme. Zhiqi – with scoring scheme

Part 2 – Threats and Opportunities

The first stage is to brainstorm with key stakeholders, team, and subject matter experts. Working with the planning team, cross departmental teams who have experience with hosting similar events. The following risks were identified and ranked, and based on that, an appropriate migration strategy plan will be deployed (See annex for a list of all the identified risks).

Risks (T/O)	Mitigation Strategy	Mitigation Plan
1.4.1 Running behind schedule	Mitigate	Ensure the plan has buffer built in with regular checks at key milestones before the event.
2.2.1 Ticket demand higher than expected (O)	Exploit	If excess tickets are sold, the team has to utilize the opportunity as this will lead to profits. A small adjustment in space and amenities should be put in place to avoid any overcrowding issues
4.4.2. Guest under the influence	Mitigate	The security team should also be present in the crowd to ensure crowd control.
2.1.1 Going over budget	Mitigate	Budget should be fixed for each sub level of the WBS and continuously checked at each key milestone. Though the management team has high tolerance for over budget due to more foreign enrollment, a threshold is always present.
5.1.1. Entertainment expectations	Accept	Ensure that the most popular artist is invited to perform. Two artists should be invited so that more choice is available for the people
4.1.1. Under or overestimated attendance (O)	Accept	This would be directly linked with ticket sales. If under attendance is present compared to the ticket sales, the event does not incur financial loss. If more people show up at the last minute, then this will boost up the financial revenue. The planning team has to ensure a certain percentage of space and amenities are provided.
1.3.1 Unexpected results from the promotion	Mitigate	Ensure the promotion team follows a certain script and get the appropriate approvals for hoardings, advertisements.
2.3.1 Sponsorship	Research	Ensure that the request for sponsorship letter properly communicates the need and the benefits for the sponsor. This is the main opportunity to increase funding with the apt presentation to sponsors; Funding from alumni should be one key source of extra funding along with the management approval for extra funding.
6.1.1. Weather changes (T/O)	Accept	Ensuring ponchos for customers are available for purchase, this can be used as a revenue stream. Equipment covers should be kept as backup in case of a rain forecast.
6.1.2. Natural disasters	Avoid	Cancellation of the event on humanitarian basis.

Part 3 – Methodology

Process used to identify threats and opportunities: An efficient process of risk and opportunities identification for the project will be 'Cause and Effect (Diagramming Technique)'.

Reason for choosing the 'Cause and Effect' diagram technique: Dr. Mattes project may have multiple reasons for risks. A fish bone diagram will help identify the possible causes of a problem and its outcomes. We can use brainstorming approach to come up with structuring the diagram.

How this risk identification tool worked for the group: Possible risks that may arise and its :

· Schedule delay – Risk of project completion delay. The time to plan and execute the project is 6 months. The project has zero tolerance to schedule changes.

Causes:

· Delay in obtaining outdoor event site.

· Labor issues such as project workers leave on sick leave or FMLA

· Project expectations mis-communications.

Effects: Project completion delay. Since, this project has zero tolerance to schedule delays, it leads to complete project failure.

· Budget and Ticketing fail – Going over budget Financial Risk: The budget for the entire project is $20,000 and budget for risk management process is $500. The project has a very high level of tolerance to budget. Thus, compared to other factors in the project, the financial risk mitigation is a low priority.

Causes:

· Scope creep leading to over spending.

· Difficulty in obtaining funds – failure in promotional event

Effects: Financial burden to the project.

· Risk of failing to meet return condition of the event site: The outdoor event site has to be returned in the exact same condition it was taken over. Since, it is a 'must' condition clause.

Causes:

· Event participants may damage the site condition.

· Weather could affect the condition

Effects:

· Penalty fee from the site contractor.

· Lawsuit in adverse conditions

· Guest behavior – Risk of safety issues and noise: The event area might be subject to safety, vandalism and noise concerns. Security is required to be ensured in the premises.

Causes:

· Alcohol being served in the event

· Audience entering into feuds for personal dispositions

· Loud music from the entertaining band

Effects:

· Damage to the event site

· Injuries to people around

· Lawsuits or need for police complaints

Unit 11 – Group 1

Part 4 – Risk Register (on Excel sheet)

Annex – All identified Risks

RBS LEVEL 2	RBS LEVEL 3 (Identified Risks)	Probability	Impact	Score	Mitigation Strategy	Mitigation Plan
1.1. Senior management requirements	1.1.1. Change on requirements	3	2	6	Accept	If senior management changes the requirements, ensure it is actually beneficial for the event and appropriate funding and time is allocated.
1.2. Guest list	1.2.1 Changes to the guest list	2	4	8	Exploit	Addition of popular celebrities to attend the event will certainly enhance the event level thereby drawing more crowds. Celebrities sharing the event on their social media profile which excel the event promotions.
1.3. Event promotion	1.3.1 Unexpected results from the promotion	3	3	9	Mitigate	Ensure the promotion team follows a certain script and get the appropriate approvals for hoardings, advertisements.
1.4. Schedule	1.4.1 Running behind on schedule	5	4	20	Mitigate	Ensure the plan has buffer built in with regular checks at key milestones before the event.
2.1. Budget	2.1.1 Going over budget	4	3	12	Mitigate	Budget should be fixed for each sub level of the WBS and continuously checked at each key milestone. Though the management team has high tolerance for over budget due to more foreign enrollment, a threshold is always present.
2.2. Ticketing	2.2.1 Ticket Demand Increase selling enough tickets	3	5	15	Exploit	If excess tickets are sold, the team has to utilize the opportunity as this will lead to profits. A small adjustment in space and amenities should be put in place to avoid any overcrowding issues
2.3. Sponsorships	2.3.1 Sponsorship	3	3	9	Research	Ensure that the request for sponsorship letter properly communicates the need and the benefits for the sponsor. Funding from alumni should be one key source of extra funding along with the management approval for extra funding.
3.1. Venue	3.1.1. Not finding an available venue for the desired date	1	5	5	Mitigate	Ensure proper approvals are taken and paper work done for booking the venues. Without a venue the event cannot take place.
3.2. Alcohol license	3.2.1. Delays on obtaining the alcohol license or not obtaining it at all	2	4	8	Mitigate	Ensure the core planning team has given criticality rating for the license approval and ensure active monitoring is done alongside the council to ensure delays are not made.
4.1. Attendance	4.1.1. Under or overestimated attendance	4	2	8	Accept	This would be directly linked with ticket sales. If under attendance is present compared to the ticket sales, the event does not incur financial loss. If more people show up at the last minute, then this will boost up the financial revenue. The planning team has to ensure a certain percentage of space and amenities are provided.
4.2. Guest behavior	4.2.1. Vandalism	1	4	4	Mitigate	Security team should be briefed about all the entries, exits of the event. The security team should also be present in the crowd to ensure crowd control.
	4.2.2. Health/allergy emergencies	1	2	2	Mitigate	The security team should also be present in the crowd to ensure crowd control. AEDs should be accessible, and an emergency fire/paramedic staff should be present near the event.
4.3. Food catering	4.3.1. Cater not showing up or coming in late	2	4	8	Transfer	Fixed price contract should be present, and this may be in the form of sponsorship as well. Conditions should be that they arrive in time. One should ensure the food should be sponsored to two parties to minimize risk of no show by a certain party.
4.4. Alcohol consumption	4.4.1. Minors consuming alcohol	1	1	1	Mitigate	Alcohol provides should check the IDs before serving and non-re-attachable bands should be tied to customers arm upon purchase of first drink. This will act as an ID check complete indication. By this, the customer can avoid ID verification for their following drinks.
	4.4.2. Guest under the influence	4	4	16	Mitigate	The security team should also be present in the crowd to ensure crowd control.
5.1. Entertainment	5.1.1. Entertainment expectations	2	5	10	Accept	Ensure that the most popular artist is invited to perform. Two artists should be invited so that more choice is available for the people
	5.1.2. Entertainment not showing up	1	5	5	Transfer	Ensure 2 artists are booked for the event to ensure a backup if required.
5.2. Facilities management	5.2.1 Running out of bathroom supplies	3	3	9	Transfer	External service companies who have experience with events of similar nature should be hired.
	5.2.2 Running out of kitchen supplies	2	2	4	Transfer	Food catering contract should include this.
	5.2.3 Waste and disposal management	3	2	6	Transfer	External service companies who have experience with events of similar nature should be hired.
5.3. Technical equipment	5.3.1. Electrical outage	1	5	5	Mitigate	Ensure backup generators are present.
	5.3.2. Entertainment equipment not working	1	5	5	Mitigate	Ensure the logistics department has access to backup equipment in case any issues take place.
	5.3.3. Kitchen equipment not working	2	5	10	Transfer	Food catering contract should include this.
	5.3.3. Other facility’s equipment not working	2	2	4	Mitigate	Ensure all the equipment to be used in the event is pre-checked
5.4. Security	5.4.1 Uninvited people trying to access the venue	1	3	3	Mitigate	Security team should be briefed about all the entries, exits of the event. The security team should also be present in the crowd to ensure crowd control.
	5.4.2 Security not being enough for the amount of people at the party	2	4	8	Mitigate	Security team should have ready access to additional backup if required.
6.1. Weather	6.1.1. Weather changes	2	4	8	Accept	Ensuring ponchos for customers are available for purchase, this can be used as a revenue stream. Equipment covers should be kept as backup in case of a rain forecast.
	6.1.2. Natural disasters	1	5	5	Avoid	Cancellation of the event on humanitarian basis.
6.2. Access to venue	Roads closure	2	5	10	Mitigate	Ensure alternative routes are present to access to venue and the customers are kept informed via social media/email/texts
6.3. Neighborhood	6.3.1 Neighbors complaining about the noise	2	1	2	Mitigate	Acoustics should be aptly placed to minimize disturbance to neighbors. Appropriate approvals should be taken from the city council before the event.
	6.3.2 Neighbors sabotaging the party	1	3	3	Mitigate	Security team should be briefed about all the entries, exits of the event. The security team should also be present in the crowd to ensure crowd control.
7.1. Venue conditions	7.1.1 Cleaning crew now showing up	2	2	4	Mitigate	External service companies who have experience with events of similar nature should be hired. The contract should ensure that a backup crew should be booked in case the service company does not show up and all the costs incurred should be paid by the primary service company.
	7.1.2. Damages to the venue	2	2	4	Mitigate	Security team should be briefed about all the entries, exits of the event. The security team should also be present in the crowd to ensure crowd control.
7.2. Vendors	7.2.1 Vendors overcharges	3	2	6	Accept	The pricing for food items should be fixed and agreed upon by the team before the event.