Decision Tree I must do task 3 AS A PROJECT RISK MANAGER I MUST DETERMINE WHICH TYPE OF CONTRACT IS SUITED FOR THIS GIVEN PROJECT (PRIME CONTACTING OR MU

Decision Tree

I must do task 3 

AS A PROJECT RISK MANAGER I MUST DETERMINE WHICH TYPE OF CONTRACT IS SUITED FOR THIS GIVEN PROJECT (PRIME CONTACTING OR MULTIPLE CONTRACTING )

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MPM7004 PRES1 Group Task

Ecoviron Protect Centre (EPC)

The following fictional case study illustrates how mega and complex infrastructure project,

distinct in project phases and life cycles, must be completed before a project proceeds.

Ecoviron Protect Centre (EPC) – Project Introduction

Ecoviron Protect Centre (EPC) is multi-purpose ecological and environmental project

designated to be built in Conwy area of North Wales – a good site with a minimum of 200 acres.

This allows for structures, parking and gardens. This size of EPC allows for production to be

included in greenhouses or outdoor beds. The EPC allows for removal of storm and surface

water. The EPC project is planned to allow great visibility to attract customers. The appearance

including the buildings, landscaping and plants that are displayed should make a favourable

impression.

It is envisaged that this project aim will be accomplished by expanding to provide transport link

to the northern and southern Wales. Efficient transport systems including rails and roads

installed to be pre-programmed to follow navigational channels accurately and automatically,

and to reduce traffics and ensure value for money for the customers.

Economically, this expansion would attract visitors and spectators from every region of Wales. It

is important that there is considerable access for vehicles. The greater the site line the safer the

egress. If possible, there should also be a slowdown lane to let other vehicles pass. A permit for

highway access is usually required. Some growers have found that setting up a temporary

greenhouse in the parking lot of a shopping centre or mall can give good exposure and

expanded sales. The greenhouse needs to be anchored to resist the strong winds that

frequently affects the structure of the buildings, as well as the need to meet snow load

requirements.

Some auxiliary structures may be considered in designing the hub include plant production

tents, shopping centre or mall, car parks, and cafeteria.

Ecoviron Protect Centre (EPC) – Scope

The Ecoviron Protect Centre (EPC) is one of the Conwy County Council (CCC) projects, which

is due to be fully commissioned in Summer 2022. Currently, the EPC project is undergoing

feasibility development stage. Based on cost-benefit-analysis data and expert opinions, the

CCC Project Development Committee budgeted £6 Billion for successful completion of the

project in 36 months timeline.

The CCC is working on various project requirements and documentations for comprehensive

project planning, project delivery, project completion, project exit and other documents for

project governances and deliverables.

Key project elements of EPC Project include construction of 100 green trees production plants,

multi-storey fresh fruits and vegetable shopping centre, a multi-storey car park, and modern

continental cafeteria. The transport networks and maintenance structures involves constructing

bridges and transport network stations.

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Project Implementation

The feasibility team has presented a work breakdown structure (WBS) for the project, which

subdivides the project work into the major project activities. For example, a major element of

work is the mapping of road access and traffic flow to and from the EPC.

The project team is expected to develop the lower tiers of the WBS hierarchy in isolation. This

practice provides flexibility and full control over respective responsibilities:

WBS level 1 – Project: the project’s major construction activities.

WBS level 2 – Project units: the main project packages associated with each project and

subunits within project packages.

WBS level 3 – Contract: the main contracts that can be offered.

WBS level 4 – Contract unit: level of work effort required for the project management

such as agricultural, environmental, engineering and transportation.

The specialist team proposed that once the contracts and contract units are identified, the

project could then be outsourced to different contractors, including, most likely, a consortium.

Project Management

The feasibility team has proposed that a dedicated project management team should be

established within the CCC. The team would have total control over budgets and schedules and

would report directly to the EPC Project Development Committee. The control, planning, and

management of the project present complex logistical issues. The scheme may entail numerous

individual contract packages, which will require coordination.

At a very early stage, the feasibility team settled the key project management objectives as

• effective and efficient communication of information

• utilization of thorough project control techniques

• efficient and widely understood procurement and contractor processes

This standardisation is necessary to ensure that all project teams are working in unison. To
furnish timely and accurate cost reports, the project control team needs a comprehensive
system that integrates cost and schedule, provides reporting capabilities consistent with the
project requirements, and improves operating efficiency.

The system has to be capable of processing and analysing a vast amount of incoming monthly
cost data quickly and accurately. In addition, the team could use integrated systems to perform
risk and schedule simulation analysis where the relationship between the schedule and cost is
not always clear.

Although technology has simplified data collection and scheduling, the feasibility team has
identified that professionals must carefully study and analyse the system output to provide a
logical, meaningful explanation of the causes of any cost and schedule variances. In this way,

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sound project control methodologies reduce cost overruns, control cost growth, help meet
project schedule objectives, and ultimately satisfy the client’s expectations.

Feasibility Report

The feasibility team completed their study on schedule with an outline of strategy, detailed
recommendations, and a list of preferred suppliers, and they are waiting for risk assessment
report to be completed, before full commissioning of the project. The main outcomes from the
team are the following:

• Contractor participation is a key aspect to the success of the project, and the CCC
should establish and work with a set of preferred suppliers.

• The CCC Project Development Committee should establish a detailed project
management office that has the authority to manage and control the project and report to
senior government officials.

• The risk assessment team should determine the probability of various cost outcomes
and quantify the required contingency needed in the cost estimate and delivery schedule
to achieve any desired level of cost confidence.

Ecoviron Protect Centre – Assignment Tasks

Task 1: Risk Management Plan

As clearly stated in the Assignment Brief above, the EPC is waiting to be fully commissioned in

the Summer 2022, and project is at the initiation stage. You are part of the assembled dedicated

risk management team (including risk manager, risk analyst, risk auditor). The first set of tasks

entails identifying a risk management plan, including Risk Register for consideration to inform

key decisions by the project funder – the CCC.

Step 1: Prepare the risk management plan.

Step 2: In each section of the plan, provide the detail of what should be considered e.g.in the

‘methodology’ section…

• risk identification with explanation on how it will be completed

• risk analysis (qualitative and quantitative analysis) with explanation on how it will be

completed

Step 3: Highlight areas that you feel, as a member of risk management team, are critical to the

success of the project.

Task 2: Risk Gathering Techniques

As part of the risk management team that completed Task 1 and have delivered a risk

management plan. Funder has requested that a relevant analysis, using tools (e.g., SWOT,

PESTLE, etc.) be performed to ensure that your team have captured all potential risks and

issues required for a successful EPC project delivery.

Using Risk Identification Tools and Techniques: You have completed the PESTLE analysis and

there are some apparent risks that need to be logged. You are tasked with putting a risk

response plan together that will present

• risk event

• risk consequence

Once completed, you are required to identify potential risk responses.

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Task 3: Decision Tree

The CCC is looking at construction contracts options to minimise cost associated with project

failures (based on historical risk report). Decision needs to be made on whether the project

would be constructed under multiple contractors or multiple subcontractors. One option is to go

for a prime contractor with multiple contracts. The other option is to use multiple contractors for

agreed or limited number of contracts.

First option, which is a prime contractor with multiple contracts, estimated to cost £4.5 billion, is

controllable and entails direct relationship and monitoring, but is liable to ‘one throat to choke’ –

if prime contractor fails, the project is likely to fail. The probability of this occurring is 35% with

estimated cost of £150 million over the 36 months of operation.

Second option, which is use of multiple contractors for different projects, cost estimated £4

billion, with 25% probability of saving the CCC £100 million at the completion of the project.

These savings are associated with success and reliability rating of the contractors. As a

dedicated risk management professional, which option would you recommend? Use a decision

tree to determine the best alternative.

Task 4: Detailed Risk Analysis

In this task, you have a list of some apparent risks that need to be logged. You are tasked with

putting a risk response plan together to analyse each of the risks

• Responding to Analysed Risk

• Put a risk response plan together that includes an analysis and response strategy for
each risk.

Use the headings

• avoidance

• mitigation

• transference

• acceptance

Task 5: Risk Response Plan

Present the full completed version of the risk response template

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