Project Management Risk: Managing contingency allowance; risk protection, transfer
A. Consider the following scenario.
o A leading biomedical company hires you as a consultant to help with a serious problem. The company had planned to complete their final acceptance testing of a new pacemaker last week, but found a significant integration risk between the pacemaker and the instrumentation used to perform diagnostic analysis on the pacemaker. The cause is determined to be a lack of thorough testing due to insufficient time allocated to the integration and test phase. Your job is to investigate the risk and make recommendations to reduce the risk. Project management wants to maximize quality and minimize total cost.
How would you handle these conflicting objectives? What are your recommendations to project management regarding this risk? How does this scenario relate to managing contingency allowance?
B. Risk protection is a strategy that employs redundancy in order to mitigate a risk. An example would be a commercial airliner that has a manual override switch for the autopilot functionality. Risk transfer is a strategy that shifts the risk to another person, group, or organization. An example would be discontinuing the online help features in a new software application to save development time and money. The risk is transferred to the help desk personnel and their ability to handle the phone calls from customers.
o Show how you have used or might use risk protection and risk transfer in a situation