Regency Plaza Case Study †Risk Management Process, Review of the Options Essay

3. Risk Management Process of the Regency shoes ensureRegency Plaza is a mixed-use multi cardinal US dollar final cause withstanding quite exalted stakes. So the insecuritys of it should be evaluated beforehand and managed well in order to experience sure that the project wouldnt everywhere run reckon or time and end with a successful result. Here we use the iv Stage Risk Management Process to evaluate the risk care happened in Regency Plaza project.3.1 Risk IdentificationEvaluation how well the project was analyzed and source of the risk set.In the below table we pass on take a closer look at how well the risk was determine by Kris Hodgkins.Description place/Not Constraints and Remarkssizing the layout of the floor plate Identified Complicated due to condominiums lying over the hotel rooms over a parking garage, which resulted in fixed newspaper column spacing and elevator core locations. Number, mix and size of the condominium units Identified BRA approved maximum number of units to be built was 96, which Hodgkins chose oppose Farley, the selling consultants idea of building spacious 72 units because of Hodgkins expected performance targets of $134.4 million gross sales and $26 million net profit out of the project. Time Constraints Not identified Project was on a tight schedule as Kelly Constructions was convinced to blow off 03 month from the estimated 32 months of the project duration, with a promise of marginal changes to the original purpose.Eventually with the allowance of individual customization in the units, clients (i.e Millers) overlookd forceful changes. Manpower deficiency Not identified Neither RHG nor Hodgkins expect customers to require big alterations. But customers did, causing constant changes in the project design decreasing manpower and efficiency of the construction. Extra Costs and Delays Not identified RHG allowed customers to modify theirunits as they please as long as they accept for additional cost but custo mers asked for big modifications, the cost for purposeless materials and trim cost for demolition and delays in construction would go upon oecumenic asseverator since they got the project on fixed sum contract. External Factors Not identified It is mentioned that in later build in the project, sales were low and the local economy was weakening. Customer Dissatisfaction/Complaints Not identified With the deficit manpower and budget encroach upon, service became slow causing several demoralizeer complaints.3.2 Risk judgementBelow is a table for assessing the above-identified risks.Risk Likelihood to occur pretend Effect on the project 1. Issues regarding size of the layout and floor plate received gritty Project design is affected because of the constraints. 2. Decisions on number, mix and units of condo to be sold Certain High If 96 units of condominiums to be sold, they would emergency better marketing and excellent finishing touches.If 72 units to be sold, condo sales might non hit targets Hodgkins was supposed to hit. 3. Time constraints (Project locomote behind schedule) High High Delayed project meant pleonastic cost, which goat frustrate the ordinary contractor and customers 4. Manpower deficiency Medium High Deficit manpower shoots to slower work completion and project travel behind schedule 5. Extra costs and delays Medium High for General contractor, Medium for RHG and High for the project As the General contractor whole works for Fixed Sum Contract extra costs, which exceeds budget, would go from their profit. Delays would cause customer satisfaction and loss of sales 6. External factors Low Medium As the target market is wealthy couples, factors like Economy wouldnt case much so would non affect sales in a drastic manner 7. Customer Dissatisfaction Medium Medium This might lead to loss of some sales/ potential customers because Hodgkins marketing strategy is member of mouth and disgruntled customers wouldnt recommend the co ndos to their friends/family3.4 Risk chemical reaction emergenceAs mentioned above, many of the risks were highly likely to occur. Should any of those occur, its lastly project managers task to switch a fortuity plan, which Hodgkins didnt have. She also made wrong assumptions in the planning phase of the project thinking that customers would require only minimal changes that wouldnt halt construction process. As mentioned above some risks posted threat to Hodgkins marketing strategy as well but she didnt consider the risks and lastly failed in developing Risk Response program.3.5 Risk Response lockAs a result of not having a Risk Response plan, Hodgkins could not reduce the impact or the effect those even sots had on the project. It is authoritative that, she had to manage a multi-faceted project but she wasnt able to even reduce the additional cost, which was occurring due to her planning and marketing failures, and the deadline being overrun due to various delays.4. Review of The OptionsOption Advantages DisadvantagesInform the Millers that its in like manner late to allow changes * No extra costs for General contractor * No construction delays * Millers are able to make the changes themselves * Millers would be dissatisfied * Careful coordination is required * Sprinkler changes could shut down the entire floor raise up through the changes * Minimizes the work which have to be ripped out * If the cost is acceptable Millers will be satisfied * Its expensive to put a unit on hold * Can take several weeks * It could in return increase the cost to a point where Millers will not be happy with the cost Hire a small general contractor to finish the unit * Changes required can be through with(p) * No extra cost for the general contractor * Construction would not be delayed * Managing two general contractors * Possibility of violence and malicious mischief* Could be expensive * Kelly Contractors would give a very small realisation for the work make and materials purchased * Arguments over the responsibility of punch listitems infract the work on the unit and hand it over to Millers * Millers are in take hold of the cost and the work to be done * No extra cost for the general contractor * Most banks wouldnt accommodate modify against the unit * Can shrink the target market * Reduces RGHs control over the project * Impact on continuing construction trading operations on a building which also held a luxury hotel head for the hills Millers to a divers(prenominal) unit on the higher floor * Would buy more than time * No need to restructure whats already been applied * Construction of other floors are undisrupted * There was no equal unit available on a higher floor * internal designers work will go in vapid and would have to redesign * Higher floor units are pricierAll elections carry advantages as well as plenty of inconveniences but the best option as our point of view would be moving Millers to a different floorMoving t he Millers to a higher floor would buy more time so the cost of the changes can be assessed and approved by the Millers. As theres no interior work done on units on the higher floors there wont be any requirements to demolish anything or to put construction of other units/floors on hold, which would content the general contractor and also Millers can achieve the changes they wishing after approving the cost. There will be no wasted materials also. This option is more advantages because it would keep the general contractor content with the project.On a disadvantageous note, theres the possibility that Millers might deny the option as units on the higher floors are expensive and not identical with the unit they chose and also if Millers chose the unit, their interior designer might have the rework her designs which would cost Millers more. But given the good points and bad points, this option remains as the most feasible one.