Suppose your college or organization is considering a new project to develop an information system that would allow all employees, students, and customers to access and maintain their own human resources information, such as address, marital status, and tax information. The main benefits of the system would be a reduction in human resources personnel and more accurate information. For example, if an employee, student, or customer had a new telephone number or e-mail address, he or she would be responsible for entering the data in the new system. The new system would also allow employees to change their tax withholdings or pension plan contributions. Identify five potential risks for this new project, and be sure to list some negative and positive risks. Provide a detailed description of each risk and propose strategies for addressing each risk. Document your results in a short paper.
Review a document related to risk management, such as Microsoft’s Security Risk Management Guide, which is available from the companion Web site for this text. Does this guide address most of the topics related to risk management planning, as described in this text? Document your analysis in a short paper.
Research risk management software. Are many products available? What are the main advantages of using them in managing projects? What are the main disadvantages? Write a short paper to discuss your findings, and include at least three references.
Suppose that your organization is deciding which of four projects to bid on, as summarized in the following table. Assume that all up-front investments are not recovered, so they are shown as negative profits. Draw a diagram and calculate the EMV for each project. Write a few paragraphs explaining which projects you would bid on. Be sure to use the EMV information and your personal risk tolerance to justify your answer.
Project Chance of Outcome Estimated Profits
Project 1 50 percent $120,000
50 percent −$50,000
Project 2 30 percent $100,000
40 percent $ 50,000
30 percent −$60,000
Project 3 70 percent $ 20,000
30 percent −$ 5,000
Project 4 30 percent $ 40,000
30 percent $ 30,000
20 percent $ 20,000
20 percent −$50,000
5.Open the template file called breakeven using Microsoft Excel. Examine the formulas in the file to understand the relationships between the variables (such as sales price per unit, manufacturing cost per unit, and fixed monthly expenses) and the outputs (such as break-even point and revenue at break-even point). Run at least three different scenarios, changing the inputs as desired and noting the outputs. Write a short paper to summarize the results, including screen shots of the three scenarios and your opinions on sensitivity analysis in general and in this example.