Running head: QUANTITATIVE RISK ASSESSMENT
Quantitative Risk Assessment
University of Phoenix
PM/584 Project Risk Management
October 6, 2014
Quantitative Risk Assessment
For the project of redesigning packing for the Canadian market, quantitative risk assessment plays an important role. Quantitative risk assessment is, “A process for assigning a numeric value to the probability of loss based on known risks and available, objective data… used to determine potential direct and indirect costs to the company based on values assigned to company assets and their exposure to risk” (InvestorWords.com, 2014). For this particular project, quantitative risk assessment will be useful in determining not only which are areas of potential risk, but also to what degree these risks may affect the overall integrity of the project. Revised Project Background
The project of the redesign of packaging for the Canadian market currently consists of four different product lines including Dial, Tone, Right Guard, and Dry Idea, and consists of over 50 variants spanning the four lines. Each new packaging design is independent of every other thus there exists no interdependency from design to the next. Each design observes a similar path consisting of initial review of changes, alterations, and additions by management, marketing, and the design team, initial layout of established changes by the design team followed by a first round review of changes by marketing, legal, management and compliance. If additional changes are required, a second round of design and review is implemented up to two additional rounds as needed. Upon successful acknowledgement of new designs, the artwork is then sent to our preproduction team for development to printer-ready artwork. Once completed, the artwork is sent to a third party production house for mockups to be created to be sent to the parent company in Germany for final approval. If any designs are rejected (and they never are), commentary from Germany is implemented into further redesign and the process is restarted. Upon approval from Germany, artwork is submitted to the printer. Printer will then submit print-ready, color-calibrated proofs for final approval. Proofs are reviewed by management for final approval before actual printing. Once printed, packaging is sent to a fulfillment house to have labels applied to containers and filled with product or have wraps applied to soap bars. Upon completion of fulfillment, finished product is shipped to various holding facilities in Canada for final disposition. As previously stated, project will span eight months from inception to final delivery. Risk Identification Framework
Management Delays: As the majority of the work for this project involves objective changes and adjustments to existing packaging, the first phase, initial review by management, involves nominal risk. Management will evaluate and select which products will receive updated treatment for inclusion into the Canadian market. Once the products are selected, management has no further involvement outside of potential cancellations of various packaging designs or their requested involvement during a particular phase of completion. Design Delays: As this project includes approximately 50 variants of packaging including labels and wraps, production must be coordinated to allow for enough time for completion of initial layouts and any necessary revisions, while taking into consideration the design needs and time constrains on the design team from other departments and for other projects running concurrently. While the project has a timeline of eight months, final design layouts must be approved and ready for preproduction within the first four months of the project. The in-house design team will complete the bulk of the design phase of the project, though external design agencies may be utilized if time constraints are threatened. It...
References: Cooper, D. F., Grey, S., Raymond, G., & Walker, P. (2005). Project risk management guidelines: Managing risk in large projects and complex procurements. West Sussex, England: John Wiley & Sons.
InvestorWords.com. (2014). quantitative risk assessment. Retrieved October 1, 2014, from http://www.investorwords.com/19179/quantitative_risk_assessment.html
Loch, C. H., DeMeyer, A., & Pich, M. T. (2006). Managing the unknown: A new approach to managing high uncertainty and risk in projects. Hoboken, NJ: John Wiley & Sons.
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