Risk Management in High-Speed Railway Line Project - Case Study Example

ASSESMENT: HIGH-SPEED RAILWAY LINE PROJECT Author’s name Institutional affiliation Assessment: high-speed railway line project Plan structure summary The railway line speed running from Melbourne to Mildura via Tullamarine Airport, Bendigo as well as all the major towns between Bendigo and Mildura will be one of the most prominent projects the state government has established. However, as a project manager, it is of utmost importance to identify and analyze risks, develop stakeholder management plan and the projected project schedule in order to make it more successful, avoid conflicts and mitigate and eliminate risks that may occur (DAS 2006, p.18). Risk and risk management Risk can be universally be defined as the utmost combination of an event probability as well as its consenquences.by so sating, it means that, in every scenario, there is a high chance of consequences and events that comprises of opportunities for upside benefits or downside threats to success WALKER 2015, p.7o). In this project, the risks involved will encompass both the negative and positive aspects of risk. In other words, in order to manage the risks involved, it will be wise to consider risks from both perspectives. In the project management field, it is generally accepted that consequences of events are in most cases negative therefore management of these events solely revolves around the mitigation and prevention of the risks (DAS 2006, p.10) Risk management The risks that may affect the high speed railway can be caused by factors that emanate from both internal and external to the organization and the project as well. Additionally, some risks may have an impact on both external and internal organization drivers and may therefore overlap the two aspects. Some of the external risks that may affect the high speed railway project implementation and planning include; first is financial risks which come in the form of foreign exchange, credit and interest rates as far as the railway is concerned (RESTI & SIRONI 2007). The high –speed railway line may also be influenced by strategic risks which may occur in terms of competition, customer demand, customer changes and industry changes (WALKER 2015, p.75). The railway line may also be affected by operational risks, which basically occurs as a result of regulations, culture and board composition. The fourth type of external risk that may influence the railway line externally is hazard risks which consist of contracts, natural events, suppliers and environment. Internally driven risks that may influence the railway line project comprises of management and accounting integration, recruitment, supply chain, accounting controls, liquidity cash flow, research and development as well as intellectual capita (RESTI & SIRONI 2007, p.14). Risk management process in any project management organization goes through a number of stages. In simple terms, it is basically a process of identifying, assessing and establishing strategies that can be used to manage the identified risks (DAS 2006, p.13). It is therefore of utmost importance to allocate some resources, time, budget for making a risk management plan of the railway line project. By so doing, it will enable the project management team to realize and meet legal obligations for establishing a safe working place as far as the high-speed railway line is concerned and in the process reduce the likelihood of a risk incident impacting the project negatively. Risk identification Risk identification works to establish the exposure of the project to uncertainty. In order to identify the risks associated with the railway line project, it requires ample knowledge and understanding of the project, the legal, social, cultural and political environment and impact of its implementation (DAS 2006, p.15). Furthermore, risk identification should be conducted in methodological manner and all the identifiable risks flowing from the project activities defined. Risk description The main aim of risk description is basically to display and present the risks that are identified in a structured format (DAS 2006, p.18). Therefore, in order to manage the risks associated with the railway line construction, it is important to embed risk management at the conceptual processing stage. In this project, risk description may take the form of, the risk name, scope of the risk, stakeholders affected, nature of the risks, and risk quantification among others. Risk estimation The estimation of the risks associated with the railway line project are basically, quantitative, qualitative, and semi-quantitative as far as occurrence probability and the possible consequences are concerned (WALKER 2015, p.75). By way of explanation, the estimated consequences may be categorized in terms of threats to Bendigo, Melbourne city or the citizens surrounding the railway line and opportunities as either medium, high or low (RESTI & SIRONI 2007.p.17). However, the probability estimation may need different descriptions in respect to opportunities and threats. Risk evaluation When the risk analysis process of risk management has been finished, it is important to compare the risks that are estimated versus the risk criteria that the project management organization has put in place (RESTI & SIRONI 2007, p.16). In this railway line construction project, some of the , the factors that make up the risk criteria comprises of the costs of materials and resources, legal requirements, benefits of the railway line to the state government and the citizens, environmental and socio-economic factors associated with the railway line construction 9RESTI & SIRONI 2007, P.14). Stakeholder management Stakeholder management details the activities of the railway line project related to engaging the organizations stakeholders as well as making the most effective use of stakeholder participation (FRENKEL 2005, p.23) Additionally, stakeholder management of the railway line construction includes the project processes needed to identify the people, organizations and groups that could be impacted by the project and to establish strategies as well as tactics for engaging stakeholders effectively in a manner that is appropriate to their interests as well as their project involvement(WALKER 2015, p.75). For instance, all the resources and individuals within around Melbourne to Mildura via Tullamarine Airport, Bendigo as well as all the major towns between Bendigo and Mildura are some of the groups and individuals that will be affected either directly or indirectly by the project. By so saying, it means that, stakeholder management helps the project managers to see to it that the stakeholders are effectively engaged in the project execution and decisions throughout the entire project cycle, gain the project support, and anticipate competing objectives, conflicts and resistance among project’s stakeholders (HARRIS MCCAFFER EDUM-FOTWE 2013, p.46). The stakeholder management plan is made up of a number of sections which include the following; First step is identifying the stakeholders such that they are known by name, title, organizations, and groups that have an important influence on the railway line project direction, its success as well as those individuals who are significantly affected by the project (WALKER 2015, p.75). The second section is the plan stakeholder management that involves the identification of mechanisms and strategies that will be employed to realize the largest stakeholder support and in the process minimizes resistance. The third section is management of stakeholder engagement which basically outlines the steps and processes that will be carried out to undertake the planned strategies (STRONG 2009, p.13). The final section controls the stakeholder engagement such that it describes the techniques and methods that will be employed to examine and monitor engagement and in the process, alert the railway line project team in case of any problems. However, the stakeholder management plan as well as any related documents and files are not static (HARRIS MCCAFFER EDUM-FOTWE 2013, p.46). By so saying, it means that, the identified stakeholders of the railway line project as well as their data and information that is filed in the stakeholder Analysis Register needs to be reviewed frequently so as to ensure that the project plan is within the expectations of the railway line project and may therefore make modifications if need be. Scheduling and resourcing quality in the plan The timing of this railway project has been approximated on a monthly basis. Additionally, the project completion date cannot be easily be projected since it is kind of difficult to know the exact incidences that may cause delays or instances that may make certain project aspects to be done faster than the originally projected period (RESTI & SIRONI 2007,p.13). However, as per now, the projected scheduling is as follows; first, the project has been decided to commence its construction as from November of the year 2015 and to end in the year 2018. The months of October will be used to conduct research and development on the railway project. In November 2015, there will be training of workers and staff members on issues related with the high speed railway construction. The initial project construction will commence as from November 2015 to July 2018 under the stakeholder judge of operations manager. After completion of the project construction, safety tests will be conducted as from July 2018 up to November 2018 under the guidance of the operations manager. Three years was the agreed upon period since the railway line will first be constructed and then tested for future use. In other words, safety and quality are one of the most important prerequisites of project management; therefore, extra cost and time will also be incorporated in the railway testing and execution of the railway project with safety and quality in mind. As mentioned earlier, the projected timeline is based on monthly basis but the projected dates will become more specific as the project goes on and on. The projected budget of the railway project is approximately three million AUD which has been estimated per railway kilometer. Given the fact that the railway distance is five-hundred and forty, the total estimated budget will be1.62 billion AUD. Additionally, the budget of this project was arrived upon research of costs relating to similar railway lines of high speed globally and applying their logistics to the ongoing project (FRENKEL 2005, P.63). Moreover, those factors that may delay the progress of this railway project hence in the progress increasing the overall project costs were also put into consideration. For instance, planning permission, public complaints, physical and land terrain barriers, and disagreements with the government are some of the factors that may slow-down the railway progress. The costs that will be covered by the budget include the labor costs, materials, promotional costs and research costs. However, as much as this is the projected budget that were are alleged to adhere to, as a research group, no corners will be cut so as to comply with the projected budget an in the process compromising the overall quality and safety of the railway project. The timeline of the project is as shown below in monthly basis. MILESTONE COMMENCEMENT DATE COMPLETION DATE STAKEHOLDER MANAGER ACCEPTANCE CRITERIA Research and development October 2015 October 2015 Operations manager Accurate and detailed plan Training of employees November 2015 November 2015 Operations manager Sign off by all the employers Construction November 2015 2018 July 2018 Operations manager Legal labor approval Safety and quality tests July 2018 November 2018 Operations manager Approval by the project management quality assessment team References DAS, S. (2006). Risk management. Hoboken, NJ [u.a.], Wiley. FRENKEL, M. (2005). Risk management: challenge and opportunity; with 125 tables. Berlin [u.a.], Springer. HARRIS, F., MCCAFFER, R., & EDUM-FOTWE, F. (2013). Modern construction management. Hoboken, N.J., Wiley-Blackwell. http://oclc- marc.ebrary.com/Doc?id=10667408. RESTI, A., & SIRONI, A. (2007). Risk management and shareholders' value in banking from risk measurement models to capital allocation policies. Chichester, England, Wiley. http://public.eblib.com/choice/publicfullrecord.aspx?p=292582. STRONG, R. A. (2009). Portfolio construction, management, and protection. Mason, Ohio, South-Western Cengage Learning. WALKER, A. (2015). Project management in construction. Read More