Regency plaza example risk management process

3. Risikomanagement Process of the Regency Plaza Project

Regency Plaza can be described as mixed-use variable million US dollar task carrying quite high stakes. And so the risks from it should be examined beforehand and managed well at order to make sure that the project wouldn’t more than run budget or time and end having a successful effect. Here we use the “Four Stage Risikomanagement Process” to evaluate the risk management happened in Regency Plaza project.

3. 1 Risk Identification

Evaluation: how very well the project was analyzed and way to obtain the risk identified.

Inside the below stand we will take a closer check out how very well the risk was identified simply by Kris Hodgkins.

Description| Identified/Not| Constraints and Remarks|

Size design of the flooring plate| Identified| Complicated due to condominiums lying over the rooms in hotels over a auto parking garage, which resulted in fixed column space and escalator core locations. | Number, mix and size of the condominium units| Identified| V?LDIGT BRA approved maximum number of products to be created was ninety six, which Hodgkins chose other Farley, the marketing consultant’s idea of building spacious seventy two units as a result of Hodgkins’ anticipated performance goals of 5.

4 million gross sales and $26 mil net profit out of the project. | Time Constraints| Certainly not identified| Project was on the tight schedule as Kelly Constructions was convinced to slice off 03 month from your estimated 32 months from the project timeframe, with a guarantee of minimal changes to the first design.

Eventually with the permitting of specific customization in the units, clients (i. electronic Millers) necessary drastic alterations. | Staff members deficiency| Certainly not identified| Nor RHG nor Hodgkins anticipate customers to require big alterations. Nevertheless customers would, causing constant changes in the project design lessening manpower and efficiency from the construction. | Extra Costs and Delays| Not identified| RHG allowed customers to change their units as they please provided that they purchase additional price but clients asked for big modifications, the fee for thrown away materials and extra cost to get demolition and delays in construction would venture upon general contractor simply because got the project about fixed total contract. | External Factors| Not identified| It is stated that in later phase in the task, sales had been low as well as the local economic climate was worsening. | Buyer Dissatisfaction/Complaints| Certainly not identified| While using deficit manpower and price range overrun, service became gradual causing a number of buyer complaints. |

three or more. 2 Risk Assessment

Under is a table for examining the above-identified risks.

Risk | Possibility to occur| Impact| Influence on the project| 1 . Problems regarding size of the layout and floor plate| Certain| High| Project style is damaged because of the limitations. | 2 . Decisions on number, blend and models of condo to be sold| Certain| High| If ninety six units of condominiums to be sold, they would need better marketing and superb finishing touches. If 72 units being sold, condominium sales might not hit goals Hodgkins was supposed to struck. | a few. Time constraints (Project falling behind schedule)| High| High| Delayed project meant extra cost, which can frustrate the General builder and customers| 4. Manpower deficiency| Medium| High| Shortfall manpower causes slower job completion and project dropping behind schedule| 5. Extra costs and delays| Medium| High pertaining to General contractor, Medium pertaining to RHG and High to get the project| As the overall contractor performs for Fixed Sum Agreement extra costs, which is higher than budget, would venture from their earnings. Delays will cause customer satisfaction and loss of sales| 6th. External factors| Low| Medium| As the point market is wealthy couples, factors like Economic system wouldn’t matter much so will not affect revenue in a major manner| several. Customer Dissatisfaction| Medium| Medium| This might lead to loss of a few sales/ customers because Hodgkins’ marketing strategy is usually word of mouth and dissatisfied buyers wouldn’t recommend the condominiums to their friends/family|

3. 4 Risk Response Development

As stated above, many of the dangers were very likely to occur. Should any kind of those arise, it’s ultimately project manager’s task to have a contingency plan, which Hodgkins didn’t possess. She also made wrong assumptions in the organizing phase from the project convinced that customers would require simply minimal adjustments that more than likely obstruct development process. As stated above some dangers posted risk to Hodgkins marketing strategy as well but the lady didn’t consider the risks and ultimately failed in developing Risk Response software.

3. 5 Risk Response Control

Due to not having a Risk Response plan, Hodgkins could not reduce the impact or the effect those events had on the project. It is accurate that, the girl had to take care of a multi-faceted project but she wasn’t able to even reduce the additional cost, that was occurring as a result of her preparing and advertising failures, and the deadline staying overrun due to various holds off.

4. Review of The Options

Option| Advantages| Disadvantages|

Notify the Millers that it’s past too far to allow changes| * Zero extra costs for General contractor 5. No building delays * Millers can make the alterations themselves| 5. Millers can be dissatisfied 5. Careful skill is required 5. Sprinkler adjustments could power down the entire floor| Push through the changes| 5. Minimizes the task which have to be ripped out * In the event the cost is satisfactory Millers will probably be satisfied| 5. It’s expensive to put a unit on carry * May take several weeks * It could in exchange increase the cost to a level where Millers will not be satisfied with the cost| Hire a tiny general builder to finish the unit| * Changes essential can be done 2. No extra cost for the typical contractor * Construction will not be delayed| * Taking care of two general contractors * Probability of violence and vandalism

5. Could be expensive * Kelly Contractors gives a very little credit pertaining to the work completed and supplies purchased * Arguments above the responsibility of punch list items| Stop the job on the unit and hand it over to Millers| * Millers will be in control of the charge and the job to be done * No extra cost to get the general contractor| * The majority of banks more than likely accommodate financing against the product * Can easily shrink the point market 2. Reduces RGH’s control over the project 5. Impact on continuous construction functions on a building which as well held an extravagance hotel| Push Millers to another unit within the higher floor| * Might buy additional time * No need to restructure exactly what is already been utilized * Building of other floors are undisrupted| 5. There was zero identical unit available on a higher floor 5. Interior designer’s work is going in vain and will have to redesign 2. Higher ground units will be pricier|

Almost all options bring advantages and plenty of aggrevations but the most suitable choice as the point of view would be moving Millers to a different floor

Moving the Millers to the next floor will buy more time so the cost of the changes can be assessed and approved by the Millers. Because there’s no in house work done on units for the higher flooring surfaces there defintely won’t be any requirements to demolish anything as well as to put building of additional units/floors on hold, which would content material the general company and also Millers can achieve all of the changes they want following approving the charge. There will be no wasted elements also. This method is more advantages because it might keep the standard contractor at ease with the project.

On a disadvantageous note, will be certainly the possibility that Millers might reject the option since units around the higher floors are expensive rather than identical with the unit they will chose and also if Millers chose the product, their interior designer might have the rework her designs which will cost Millers more. Nevertheless given the good points and bad details, this option is still as the most feasible one.

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