The part one of this project discusses several challenges that can affect the success of a project. Ineffective project management and inefficient project planning are part of the top challenges of project implementation, which consequently lead to project failures if these challenges are not effectively managed. In the contemporary project environment, one of the major challenges facing project implementation is the project's risks, typically, every project carries risks and bigger projects carry more risks than smaller projects. Understanding the strategy to manage the project risks is very crucial in delivering a project that meets stakeholder's goals and objectives (PMIS, 2013). Risks are uncertain events that can cause negative effects to a project. However, it is the responsibility of the project manager to identify potential risks before the project starts, the risks such as change in project requirement or equipment malfunction can be identified before the project start, however, some risks appear as the project continues and if not properly managed, they could escalate the project costs.
Objective of this project is to provide solutions to some of the challenges facing modern projects. The study reviews the literatures to enhance a greater understanding on the strategies to arrive at effective solutions to the project's challenges.
This section provides different solutions to challenges facing project managers when managing projects. The study recommends solutions such as effective project planning, implementation of risk management, stakeholder's management, and effective project communication plan. These solutions when effectively implemented will assist project stakeholders to achieve their project goals and objectives.
Shelmerdine, (1989) identifies project planning as an effective method to achieve a project's success. The author argues that many projects end with failures because the project stakeholders do not integrate effective planning in the project lifecycle. Typically, planning entails a systematic procedure to achieve a business objective. Similar to other business organizations, a project requires an effective planning to achieve project success. A project planning involves a procedure of defining strategies that a project manager should follow when executing, controlling, monitoring and finishing a project. (Melton, 2009). The project manager is required to set the project goals, creating the project schedule as well as creating the project-supporting plan. Shelmerdine, (1989) argues that the work of a project manager is to identify the project objectives and break the objectives into the subset tasks. Moreover, the general manager must identify all tasks that are required to be performed for the successful completion of a project. The next step is to assign costs and timeframe to all tasks and subtasks. This strategy will assist the project manager to monitor the costs and time assigned to each tasks in the project lifecycle. Using this strategy, the project manager will be able to complete the project on budget and time, and the project manager will be able to avoid cost escalation associated to project failures.
Melton, (2009) identifies a Gantt chart as an effective tool to assign costs and time to all the project's tasks and subtasks. The Gantt chart will assist the project manager to monitor the progress of the project based on the time and costs assigned to each task. This technique will assist project manager to complete the project on costs and schedule.
Project risk management is very critical to achieve successful completion of a project and risk management process is an effective method to manage project risks. Typically, risk management is the processes of identifying many events that can cause project risks and devise risk response reduce these risks (Lam, 2003). The risk register is one of effective methods to manage risks. The first method in managing project risk is to use risk identification, which involves listing all the potential risks in the risk register. Typically, the project team can use technique such as brainstorming to identify all the potential problems that can cause project failures.
Risk assessment is the next step in the risk management process. Risk assessment is the process of analyzing all risks and stratifying all the risks based on their level of importance. Typically, some risks are more important than the other is and the probability of occurrence of individual risks may be higher than the other risks. One of the methods of risk analysis is to use numerical scale to list all the risks and use the scale to identify the probability of the risks to occur. (Virine, and Trumper 2007).Using the risk assessment matrix, organizations can categorize risks based on their severities to a project outcomes. As being revealed in Fig 1, the impact of risks to a project outcome are categorized as very low, low, moderate, high and very high.
Fig 1: Categorizing Risks based on its Severity
Source: Larson & Gray, (2011)
Larson & Gray, (2011) agues that the project manager can use NPV (net present value) to assess a project's cash flow risks, and the cash flow risks can be assessed using a correlation between "PERT (program evaluation and review technique) and PERT simulation can be used to review activity and project risk." (Larson & Gray, 2011 p 219). Typically, PERT is an effective tool to evaluate the project cost and schedules. Using this technique, the project manager will be able to evaluate likelihood of a project to be completed on budget, time, and resources.
Risk response is also the strategy of managing project risks, which include "avoiding, mitigating, transferring, retaining or sharing." (Larson & Gray, 2011 p 219). Mitigating risks is to reduce the adverse event of project risks. For example, the project manager can mitigate the adverse risks effects on information system project by testing the new system on smaller network before launching the entire project. Using this strategy, the project manager will be able to identify variety of project problems and come up with the solutions to the problems before launching the entire project. (Project Management Institute, 2013).
Risk avoidance is a risk management process that involves changing the entire project plan; the risk avoidance strategy can be used when the adverse effect of the risks is very high on the project outcome. In a case of a project that requires specific suppliers of materials, the project manager may change from choosing a Pakistan supplier to an Australian supplier and avoid the risks that could emanate from political unrest that could delay or disrupt the entire project.
Risk transfer could also be used to pass the risk to a third party. For example, the project manager can pass the risks to another subcontractor who accepts to implement part of the project. Using this strategy, the project manager will be able to avoid the risks because the subcontractor will be responsible to bear the risks. . Another strategy is to pass the risk to an insurance company, however, this strategy is impractical and costly because the insurance company can take the advantage of the gravity of the risks to charge high premium. (International Standards Organization, 2012). However, the project manager can decide to accept some risks because it is not feasible for a project manager to transfer the risks such as flood and earthquake to other party because the likelihood of the risks occurring is very small.
The stakeholder management is another issue that can cause project failure if not properly managed. Project stakeholders consist of individual or group who have interest in the project and which project activities will affect them directly and indirectly. Stakeholder's management is very important because a successful cooperation of project stakeholders will enhance project success. However, it is the responsibility of the project manager to understand the degree of influence of each stakeholder on a particular project. Project stakeholder management is the strategy of identifying group, organization or individuals having impact on the outcomes of a project and devise effective management strategies to manage these stakeholders by engaging the stakeholders in project execution and decisions. Continuous communication with the stakeholders is an effective way to manage stakeholders in order to understand their expectations and their needs and addresses the issues as they arise. More importantly, it is the responsibilities of the project manager to enhance a continuous communication with stakeholders in order to understand their needs and expectations. The project manager needs to constantly engage stakeholders in project activities and decisions (Lewis, 2006). Since project stakeholders have varying degree to project responsibilities throughout the project lifecycle, identification of the project stakeholders is very critical in a project's implementation. Typically, the project manager should draw up a project charter to identify the project stakeholders, and the project charter provides all the information of all stakeholders, which include project sponsor, customers, functional managers, team members, and other groups that may be affected by the project activities. (Heerkens, 2002).
The next step in the stakeholder management is to draw up the procurement document to engage all the stakeholders in the contract. The stakeholder analysis is also to collect and analyze qualitative and quantitative information on whose information should be taken into the consideration. Using stakeholder analysis,…