6
Instructions:Do not discuss the
mid-term with your team members or anyone else. The mid-term is anopen book exam.When quoting a
reference, use proper APA style citations (Author, Year ofpublication,
page#) after any brief quote and then the full reference at the end of the
exam. If you have a question of clarification, post it in the whole class
Session 7 discussion “Mid-Term Exam” area and I will answer for all the class.There is a seven
pagelimitfor this exam. Do not include the questions in
yourresponses. No discussion with your team or class members is
permitted during exam time. Your exam is due in your Assignment Folder Monday
morning 9amEST, Oct.30. Cite only references from our
course readings, sessions 1-6. Don’t forget to put your name on the top
of the exam! No late exams accepted. Use double spacing and only 12
point font.
Question 1:
Reading and Organizing Risk Data(six points/2 points per question):
a)
Each person needs to be able to read
a Probability & Impact scale. Drawing from the worldwide standards PMBOK
Guide scale, Table 11-1 (PMI, 2013, p.318), what “risk rating” by
numerical percentage can be a high risk if a project’s scope is
experiencing many risks of expansion (called “scope creep” due to unauthorized
add-ons) and “unacceptable to sponsor”?
b)
On slide 23 of the PowerPoint
assigned Session 2 there is a list of risk analysis tools and techniques to be
mastered this semester (see http://www.ashraf.co/attachments/article/74/PMP-CH09-Risk-Mgmt.pdf)On p.22 of the PowerPoint presentation and p.25, risk
“prioritization” is defined as part of the overall qualitative risk
analysis process and updating of the Risk ter. How do the authors
Baccarini & Archer (2001) describe this process of “risk ranking” in the
Australian case study they analyze, as they make recommendations for
prioritizing risks? One paragraph limit for your response.
c) Pareto
charts are a useful visual method of plotting data by “frequency” of
occurrence: how often they occur. In your words (the article on PERIL databases
will guide you with examples), why would such a Pareto bar chart be useful for
a PM reporting status of several project risk areas to their internal
stakeholders? See the two articles by Kendrick (2008, 2009) assigned reading in
session 3. One paragraph limit, with correct APA citation format.
V2_Oct20_MidTermExam_PRB_PMAN637 1
Question
2 Risk Mgt. Tools and Methods in Performing Quantitative Analysis(worth
6 points).Review the process
“elements of risk analysis” illustrated in
your Practice Standard for Risk Analysis (PMI, 2009,
p.41) below. Describe three useful methodsto “perform
quantitative analysis” and cite(no direct quotes: must be in your own
words!) from methods described in 3 different readings from sessions 1-6.
(Limit one paragraph per each method described – examples are encouraged from
readings, exercises or discussions).
V2_Oct20_MidTermExam_PRB_PMAN637 2
V2_Oct20_MidTermExam_PRB_PMAN637 3
Question
3 (Worth 8 points). A) Read the attached “Mexi-Energy” case and format a Risk
ter table. Identify the top six risks facing the Project Management
team which could be rated using the attached scale.Rate
your risks using the scale provided at the end of thecase.
B) Since there will be expensive “penalty clauses” in the contract for any
delays, explain two methodsto mitigate risks to scheduling. Cite
readings.
Producing Electricity via Steam-Powered Turbines: A Hypothetical Case
Study
Sam Martinez is seeking to invest a portion of his
considerable assets in the “independent” electric power production industry in
California, a sector projected to experience very rapid growth in the 21st
century. He has set up and funded a company “MexiEnergy Inc.”. The intention is
to use the company to build and operate an electric power plant, and then form
a non-profit organization to “donate” some of the power to social service
agencies serving immigrant families.
However, the large public-sector (hypothetical) California
Energy Resources produces most of the power for California. The main exceptions
are co-generation plants associated with food processing, timber and similar
industries, some small hydro plants which generate electricity for northern
California via water into steam, which turns “turbines” in the plant – thus
electricity is produced. These “independents” are Mr. Martinez’ business models
but also competition. California Energy operates all long distance
distribution, selling electricity to municipal utilities for local
distribution; brokering power sales to large industrial customers, and
providing electricity wholesale to small rural customers.
Privatization of California Energy is being argued by
leading environmental groups, with a view that increases in electricity cost
per unit which would decrease electricity consumption. These probabilities have
been calculated as part of California Energy’s financial forecasts but lack any
risk management plan.
Sam has identified what he believes to be his first big
opportunity. It would involve:
1. Producing
base load electric power for sale to California Energy in a northern California
town using a CCGT (combined cycle gas turbine) set of natural gas powered
turbines driving generators with waste heat producing high pressure steam to
drive a steam turbine generator.
2. Providing
(for sale) low pressure steam for manufacturing organizations in the immediate
vicinity of the CCGT plant.
The local city has a natural gas network and supply, but the
supply pipeline is not large enough to cope with the proposed CCGT type of
natural gas-run
V2_Oct20_MidTermExam_PRB_PMAN637 4
turbine.
The gas supply company will provide a new main and gas at a price per unit
fixed for a substantial period of time, but require a “take-or-pay” contract
with any buyers. If Mexi-Energy decides to contract to take gas from any given
date, they will have to pay for the contracted natural gas flow whether they use
it or not.
A range of established suppliers of CCGT plants would be
willing to sell Mexi-Energy its turbine-driven equipment.
A) New
untested design. Very high fuel efficiency. Initial
reliability is uncertain. Likely to be very reliable in the long run. Claimed
very low maintenance costs. Low capital cost to encourage purchase.
B)
State of the art tested design.
High fuel efficiency, high reliability and low maintenance costs. Very high
capital cost.
C)
Tried and true design.
Low fuel efficiency, moderate reliability and maintenance costs. Moderate
capital cost.
CCGT plant suppliers will install the major plant components
on a fixed price basis. MexiEnergy Inc. has revised the scope and Contract,
with stiff penalty clauses for 1) delays or 2) performance failures which the
manufacturer must be responsible for. However, such penalty clauses may not be
operable, for example, if ground conditions are not as tested environmentally
or electrical grid connections are not in place when required.
California
Energy will provide grid connections, and will not allow anyone else to do so.
The plant could be delayed for weather reasons and start-up delayed due to grid
hook-ups or electrical black-out failures due to ‘rolling black-outs’.
Water
to turn the CCGT turbines will be taken from a river which flows through the
municipality. However, no legal environmental permits have been granted to
remove water from these rivers during the several drought years in California.
Permit fees statewide are rumored to rise dramatically before construction
begins.
Extraction of water requires municipal planning permits, and
also state gov’t. approval is required for the plant construction using water
pipelines, low pressure steam lines and power lines. All construction must be
scheduled, of course, dependent upon approvals from governmental agencies.
V2_Oct20_MidTermExam_PRB_PMAN637 5
Use
this scale when formatting your Risk ter and rating risks for part A) of
this Mid-Term Exam question 3, case analysis.
|
Probability |
Probability |
Impact ratings: |
Risk Score is calculated by multiplying |
|
|
Impact Matrix |
ratings: |
1 |
Minimal |
___ x ___ |
|
Scale |
1% -39%: |
2 Moderate |
||
|
Unlikely |
3 |
Significant |
||
|
4 |
Catastrophic |
|||
|
40%-69% May |
||||
|
or may not occur |
||||
|
70%-89%: |
||||
|
Likely to occur |
||||
|
90%-100% |
||||
|
Highly probable |
A) Read the
attached “Mexi-Energy” case and format a Risk ter table.
Identify
the top six risks facing the Project Management team which could be rated using
the attached scale. Rate your risks using the scale provided. You will need to
format this in to your Risk ter.
B) Since
there will be expensive “penalty clauses” in the contract for any delays,
explain two methods to mitigate risks to scheduling that we have studied and
discussed in PMAN 637. Cite readings
