ZEMEN POSTGRADUATE COLLEGE DEPARTMENT OF MANAGEMENT

MASTERS OF PROJECT MANAGEMENT

Individual Assignment for the Partial Fulfillment of the

Course project Planning and Scheduling

By : Jemal
Project Risk Management

In some industries, risk analysis as a subset of project management is virtually non-existent.

Project management is usually focused on cost and schedule, and delivering projects “on time,
on budget” sometimes feels like the only criteria. However, as a project manager, there is
nothing that makes you sleep at night better than knowing you have the risks to your project
under control and that the required stakeholders know about them.

Plan Risk Management: This initial step involves the production of a risk management plan, a
component of the overall project management plan.  It includes things like itemizing the risk
categories (market, procurement, resources, etc.), determining the timing and procedures for
reassessing risks, and definitions of risk probability and impact.

Identify Risks: This is where the value is created.  A good list of potential risks to a project’s
cost, schedule, or any other critical success factor is the key to great risk management. 
Checklists are a good resource, as is expert judgment and previous project experience.  The latter
tends to be elusive because we all want to forget the bad things that happened on previous
projects long ago.  Clients and bosses, however, usually don’t have the same selective memory!
Also, it’s important to note the opposite of risks – opportunities.  There are usually potential cost
or schedule savings based on project events, and identifying them in the risk register is the first
step to taking those opportunities.

Perform Qualitative Risk Analysis: This step involves prioritization of risks.  Since risk has
two components – probability of occurrence, and impact, each of these factors should be
prioritized on a scale of, say, 1-10.  High-medium-low works well too.  Each risk on the risk
register is analyzed and a ranking assigned to the two underlying variables.  Then an overall risk
priority ranking is found (by multiplication of the two rankings, or whatever appropriate
method).

Perform Quantitative Risk Analysis: Using the risk priorities established during the previous
Qualitative Risk Analysis step, the impact on the project’s schedule and budget are determined.
Each task is assigned a probability estimate for various scenarios, say 90%, 50%, and 10%
likelihood.  A bell-curve style distribution can also be used.  Then the probability of meeting the
overall cost and schedule is calculated.  This technique is called a Monte Carlo analysis,
although other methods are also valid. This is a sophisticated step that generally requires
software and is suited primarily to large projects.

Plan Risk Responses: At this step, you take the most important risks to the project and create an
action plan, not just for responding to the risk if it happens, but for monitoring the risk triggers so
you have the earliest possible warning.

Implement Risk Responses: When a risk event is triggered, the response plan springs into
action.  This process happens during the project execution phase and requires good interpersonal
and leadership skills.  Following the risk response, the issue log, risk register, and lessons
learned register are updated.

Monitor Risks: throughout the project, the risk register is monitored to ensure the analysis
remains current.  Risks are always expiring and can be labelled as “did not occur.”  Also, risk
priorities can change as many things can happen throughout a project that change the risk profile
(probability, impact) of each risk.  A re-analysis of risks might generate different priorities or
necessitate a revised risk response plan.

Project Procurement Management

Project procurement management is the creation and maintenance of relationships with external
resources needed to complete a project. A project procurement manager communicates with
vendors to buy, rent or contract products and services needed to achieve project objectives. Most
often, the selection of vendors occurs after they have placed bids to collaborate with businesses
seeking their products or services. A project procurement manager then determines which bid
and partnerships are most beneficial to their objectives. Further negotiation may take place to
ensure fair representation of both party's interests.

The Plan Procurement Management is the process of documenting the decisions of project
procurement. It is also involved in specifying approaches of procurement and identifying the
potential sellers of the project. The main advantage of this project management process is that it
helps project managers determine if the project should get external support or not. It also helps
determine what resources to get, how to get them, when to get them, and how much is needed for
the completion of the project.

Simply put, the Plan Procurement Management identifies what the  project needs to complete it.
If the project manager decides to obtain products from external sources, the processes from the
Plan Procurement Management are executed for every item that should be acquired. Aside from
identifying which items should be procured, this particular process is also responsible for
evaluating the potential sellers including who is held accountable for obtaining the relevant
permits and licenses required in executing the project activities. This  project management
process is influenced by the requirements of the project schedule and vice versa. It is important
to take note that without this process, the project will not be implemented because it lacked the
resources that it needs to begin with.

Role of the procurement management plan

The role of a procurement management plan is not just limited to understanding the project but
also helps meet the requirements required to keep the project going. Following are the five
significant roles performed by the Procurement Management Plan in an organization:

1. Create a well parallel strategy

2. Incorporate stakeholders in the process

3. Ensures timeliness of the project

4. Monitor the progress

5. Enhances comparison and rectify issues

1. Create a well parallel strategy

A procurement plan helps define the strategies based on the market conditions, external factors,
price, and risk associated with carrying out the project.

It helps to define the items used in the overall process.

2. Incorporate stakeholders in the process

Stakeholders are the lifeblood of the projects. With a procurement management plan, you can get
in touch with various suppliers and vendors by making them a part of your process. In return,
they will provide the best services, leaving you satisfied in the end.

3. Ensures timeliness of the project

A proper procurement management plan lays down this specification associated with the
different items involved in the process. It also helps to give timelines for implementation of the
project, who will be responsible, and what is to be done by covering everything as a whole.

4. Monitor the progress

Monitoring and evaluating the procurement process is vital at every step. It is crucial to know
about the progress of the work and record it for reference.

5. Enhance comparison and rectify issues

As soon as the purchasing process starts, it is essential to compare it with the actual process
stated in the plan after a specific time. If your plan matches the current state, it is good, and if
not, understand the deviations and adjust the plan to rectify the same. The points mentioned
above clearly define the role of a procurement management plan at every stage and step of the
process.

Process of Procurement Management Plan

The process of the procurement management plan is based on the nine components that we
discussed earlier in this article.

The process of the Procurement Management Plan can be categorized into the following steps:

1. Decisions related to the inputs and items to be procured internally or externally

2. Setting up budget constraints and financial scope

3. Creating criteria and frameworks for the selection of potential vendors

 4. Setting roles and responsibilities to be assigned to different stakeholders

5. Making a provision of risk factors that can be involved in the process

6. Setting up legal requirements and jurisdictions for contract

7. Ensuring payment protocols like mode, time of payment, currencies, etc

8. Creating a plan based on constraints and factors affecting it

9. Document the program based on organization policies and approval of stakeholders

along with a common seal.

10. Time to implement the project with your actions

A procurement management plan is not made randomly. Instead, it is based on a series of steps
involved to create an effective plan. The plan is inclusive of the parts involved in the
procurement process. Thus, a procurement management plan can be divided into the following
seven steps:

1. Clearly define roles and responsibilities

2. Create a schedule for operations

3. Identify and mitigate the risk associated

4. Determine the cost involved

5. Establish criteria and workflow

6. Set up vendor management

7. Review and further approval processes

1. Clearly define roles and responsibilities.

The first step towards building a procurement management plan is to identify the people who
will be working on the project. The action ensures that all the parties involved understand the
responsibilities and scope of their work. The importance of the step is easing out the process and
setting boundaries such that there is no duplication of efforts or overlapping of responsibilities.
The different roles include project managers, corporate executives, contract managers, suppliers,
and vendors.

2. Create a schedule for operations

Scheduling of operations means the setting of different timelines of the work based on the
project. For example, the purchasing process can be done in 10 days, and the packaging process
can be done in 5 days. Breaking out of these tasks with a set of different and estimated dates can
help understand the procurement process well and set the completion time.

3. Identify and mitigate the risks associated.

Risks are an inherent part of a project. It is bound to happen, and that no organization can avoid
it. Yes, you can surely minimize the risk by setting up a plan and figuring out its types and
possibilities. After you are done listing the same, mitigate your risk according to the plan and
assign a team member to take care of the same.

4. Determine the costs involved

Cost determination is one of the most crucial steps in the procurement management plan because
it is directly linked with the project's budget. It is essential to estimate the cost based on the term
of the project, scheduled dates, details of vendors' work arrangements, instrument proposals, and
bids.

5. Establish criteria and workflow

The fifth step explains the importance of establishing the criteria and workflow of the different
contracts. Before finalizing the process, it is standard that it is vital to ensure the other elements
like reviews proposals, analysis, and establishing the workflow. The criteria represent on what
basis you are selecting a particular stakeholder like vendors or suppliers. You can assign
different kinds of contracts to other people or amend the same agreement. It also helps to ensure
the capability of the vendor to give the schedule and the quality products required by the
organization.
6. Setup vendor management

Vendors are the key stakeholders responsible for the success of the procurement process. To
ensure success, this step specifies strategies and protocols for managing the vendors. Through
this, the organization can ensure the vendors, their details, type of work, and expected timeline to
deliver the goods.

The setting of vendor management also includes processes like invoices, status, and timesheets
for better flow and responsiveness of the process.

7. Review and further approval processes

The review and approval process is the final and the last step of the procurement management
plan. It provides an overview of the steps that are taken to acquire a particular product or service.
It has detailed explanations as to what to be done and what not to be done. Moreover, it also
helps to ensure flexibility and changes in the plan based on the factors and changes happening in
the environment. By creating a procurement management plan, an organization can avoid sudden
changes and surprises or last-moment considerations. It also ensures realistic project expectations
and requirements that can be completed in the proposed timeline project.

Who uses project procurement management?

Project procurement management may be necessary for a variety of industries where projects
requiring outsourced materials or services occur. The following industries commonly use project
procurement management to meet their project objectives:

Construction
Manufacturing
Engineering
Technology
Finance
Healthcare
Stakeholder Management Plan

Stakeholder Management includes the processes required to identify the people, groups and
organizations that could affect or be affected by the project, to analyze stakeholder expectations
and their impact on the project, and to develop appropriate strategies and tactics for effectively
engaging stakeholders in a manner appropriate to the stakeholders’ interest and involvement in
the project. The Stakeholder Management Plan helps ensure that stakeholders are effectively
involved in project decisions and execution (PMBOK 5th Edition) throughout the lifecycle of the
project, to gain support for the project and anticipate resistance, conflict, or competing objectives
among the project’s stakeholders. The Stakeholder Management Plan includes several sections:

Identify Stakeholders – identify by name and title the people, groups, and organizations
that have significant influence on project direction and its success or who are
significantly impacted by the project.
Plan Stakeholder Management – identify the strategies and mechanisms that will be used
to achieve the greatest support of stakeholders and minimize resistance.
Manage Stakeholder Engagement – outlines the processes and steps that will be
undertaken to carry out the planned strategies.
Control Stakeholder Engagement – describes the methods that will be used to monitor
stakeholder engagement and alert the project team if problems are surfacing.

Project Integration Management

Project integration management is a project management knowledge area that helps teams work
together more seamlessly. Integration management takes various processes, systems, and
methodologies and brings them together to form a cohesive strategy. In order to accomplish this,
trade-offs need to be made. Project goals need to be the guiding star when determining when and
where these trade-offs will be made and will require buy-in from the full project team and all
stakeholders. Everyone won’t get what they want, but the end result will be a project completed
on time and within budget.

Project integration management steps

Before implementing integration management processes, you must first gain a clear
understanding of current systems, processes, and methodologies utilized by every team in the
project. As a project moves forward, there are six primary integration management steps and
milestones with corresponding deliverables:

Project charter
Scope statement
Project management plan
Direct and manage project work
Perform integrated change control
Close project or phase

Developing a project charter

Traditionally, the project sponsor or project manager writes the project charter, and it serves
multiple purposes throughout the project life cycle. This high-level document provides the
project manager with the authority to execute the project and likely will not require adjustment
as work proceeds. It also outlines the initial roles and responsibilities of all team members and
establishes goals and project deliverables.

Write the scope statement

Scope statements fulfill one of the most important project aspects: outlining everything included
in the project. It provides a framework for all tasks, which teams execute those tasks, and what
deliverables are needed. While these scope statements occasionally shift throughout the life of a
project, it is vital to keep them as accurate as possible from the beginning to avoid scope creep.

Develop a project management plan

The project management plan brings all aspects of the planning phase together into a single
document. It includes project goals, budget, risks, scope, work breakdown structure, stakeholder
management plan, and change management plan. This fixed plan should not change without a
formal change request.

Direct and manage project work

Teams complete most of the work associated with a given project in this step of integration
management. This involves managing resources, executing on the work, and creating changes
where necessary. Review performance against project goals throughout the project’s life in order
to make necessary changes and keep things on track. To avoid scope creep, communicate and
stay transparent, with every team and department involved. Use the scope statement as a
guidepost to achieve the original intent of the project.

Perform integrated change control

Change control spans the life of a project. The project plan, goals, and scope statement are
integral assets in this iterative process. Never jeopardize the primary project goals with revisions
made during this process and take corrective action when any change strays too far from the
plan. Request and document any changes through an official process and avoid ad-hoc changes
to minimize scope creep. The project manager appoints members of a control board who help
evaluate change requests and outline next steps.

Close project or phase

This is where successful projects wrap up. This step involves reviewing various aspects of the
project and documenting findings to a reference archive. Some project teams find it useful for
each member to rate the project execution and management in an official post-mortem review
meeting.