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Weighing Perceived Risks

With Project Integra having began, there identification, analysis and weighing of the perceived risks critical to the success of the project is an important management responsibility (Altunbas & Marques, 2004). These risks will be weighed here in order of decreasing severity to the project. Uniquely, there exists the risk of skill and competency gaps that is the most critical even in the eyes of the members of the steering committee. In fact, one of the committee members, the Senior Manager, Systems, ABI, notes that the technical staffs of ABI have not been involved in such projects before.

This indicates a gap in the staffs’ expertise and the high-level techniques needed to execute Project Integra. Moreover, the FAFS representative in the project steering committee observes that the team to execute the integration lacks the important skills and/or related experience in the field of network design. As such, expertise and competency gaps pose the biggest risk to Project Integra. Secondly, resource availability and constraints come second in severity.

This weighing is in following with the ABI Chief Executive Officer remarks that additional resources are not available for the project, and that the availability of technical human resource is a major concern. To add to

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the gravity of this risk, one of the steering committee members holds that possible delay in receiving input from FAFS will cause problems in the design and implementation of integration. The FAFS representative also states that finding additional resources for the project will be difficult.

This evident scarcity of important resources is a critical risk best rated as second with regard to its possible impacts on the project. Third, keeping in mind the rapid technology advancements, the network technologies and equipment applied in Project Integra are at risk of becoming obsolete. In that case, there is risk of incurring additional costs due to need to upgrade the technologies in the course of the installation process. This puts technology obsolescence third in severity. Fourth, the risk of lack of team synergy and commitment to work is an important risk to Project Integra.

This is especially in the consideration that two of the network specialists, all the four database specialists and the two office staff are hired on part-time basis. As a matter of fact, one committee member is very concerned with the hiring of the few database specialists on a part-time plan that comes fourth in weight of possible impact on Project Integra. Fifth, depending on FAFS entirely for design inputs could also impact negatively on the project, as noted by the steering committee member that there will be problems in network design and execution in case the design and network compatibility inputs are not delivered from FAFS in time.

This is because there is no other source for the inputs for this particular project. Sixth, the change in management stratification and priorities comes sixth in the risks following the new combination of management strategies from two different organizations. There is risk of conflicts of interest between the management of ABI and that of FAFS due to objectives that are unspoken or those arising later after the acquisition. This risk poses the danger of managerial sabotage or boycott when one side feels that other is laying priorities wrongly or exploiting the other (Altunbas & Marques, 2004).

The risk of availability of network comes seventh in severity. This assessment is based on the other factors of resource scarcity and the fact that FAFS will be solely providing the network inputs. In case FAFS fails to deliver the network equipment in time or fails to deliver all together due to resource constraints, the successful network integration will be delayed. On the eighth position in the order of decreasing risk severity are the disparities in legacy systems and standards between ABI and FAFS.

While ABI’s ATM network is structured on legacy systems and platforms with the bank adopting the latest technologies to widen its regional reach and expand its financial portfolio, FAFS operates on cutting-edge banking platforms and state-of-the-art technologies. These disparities are likely to affect the mutual integration as the network systems will be dominated by FAFS technologies that may sideline ABI technicians. Nine, the risk of infrastructure problems carry less weight and are a minor threat to the success of the Project Integra.

This is because the infrastructure already owned by ABI and FAFS will be mutual property hence expansion is only a future consideration. Lastly, the least important risk to Project Integra is occurrence of natural and man-made disasters. The fact that both ABI and FAFS are insured against these eventualities among other hazards, this is a risk that poses little threat to Project Integra. Having weighed the perceived risks in this section, the next section will identify other possible risks to the project and propose plans to mitigate them.

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