I am in need of two separate student responses Project management The responses can be 2 paragraphs each with references.
STUDENT RESPONSE 1
“A project is a temporary endeavor undertaken to create a unique product, service, or result”(PMBOK, p.4), but, in order to effectively execute a project, the processes of project cost management is required early in the project planning. This process is important because it sets the framework for each of the cost management processes that are needed so that each project performance and activity will be more efficient and coordinated throughout the project.
The development of cost management plan often contain project management accounting tools e.g. budgeting, tracking, reporting cost, profitability etc., that are purposely used to improve the business skills of project managers including the financial performance and needs of an organization (Callahan et al, p.xii). The Project Risk Identification, Selection, and Management (PRISM) Model is another project management tool that was designed to “help companies develop a cost effective go-no-go decision process” by using historical data for the risk analysis (Auchey et al, 2003).
Today, the term, “strategic alignment”, and “mission and objectives”, are used by companies both large and small, and quite often, one or more areas of the company don’t know what the other area(s) are doing (Callahan et al, p.3). This example is one of many gaps in the real-world that exist and it’s problematic a leader why company are failing or go out of business within the first five years of opening. As previously mentioned, PRISM is an integrated project management tool designed to reduce overall risk and enhance project opportunities and increase company profitability in the present and future state (Auchey et al, 2003).
Adding a contingency fund is considered one of the most common method for protecting the company from potential risk, however, according to Auchey et al, (2003), this approach has weaknesses, for instance:
1. Contingency figure is not appropriate for the proposed project
2. Estimators have a tendency to double count risks
3. Percentage addition results in a single-figure prediction of estimated final cost
4. The method usually assesses risk only as a negative and does not consider positive potential
The contingency funds method is considered a very risky process ,and according to, Ranasinghe’s (1997) analysis, this process is “inadequate, misleading, and cost inefficient” and is an issue and it needs to be collected as a lesson learned for both current and future state decision makers.
The PRISM Model contain features that are used to organize and quantify project selection in a format that is easily stored and retrieved. My assumption is that this tool allows the operator of the tool to process the information more efficiently. From the time of this article, dated 2003, the model planned to incorporate three other components (PRISM, I, II, II) with the understanding that they will all be combined to predict the data effectively, and enhance the potential for acquiring projects with higher profit margins (Auchey, 2003).
Improvement to the PRISM Model (PRISM I, II, III) tells me that this program is capable of providing decision-makers an effective tool to explore risk management risk differently and allow quality information for company to make good “go/no-go decisions”.
Real world application increased scalability and reduced project cost for AECOM, a global engineering and construction company who uses PRISM for project lifecycle management software to massively reduce project cost, gain complete insight into their data, and improve repeatability of analysis (Aresprism, 2019).
Daniel
References:
Aresprism.com (2019). Resources: Case Studies. Source received from https://www.aresprism.com/resources-case-studies/
Auchey, F.L. & Auchey, G.J. (2003). Using PRISM model to improve profitability. Paper presented at PMI Global Congress 2003-EMEA, The Hague, South Holland, The Netherlands. Newtown Square, PA: Project Management Institute. Source from https://www.pmi.org/learning/library/using-prism-model-improve-project-profitability-7799
Callahan, K. R., Stetz, G. S., & Brooks, L. M. (2011). Project Management Accounting : Budgeting, Tracking, and Reporting Costs and Profitability (Vol. 2nd ed). Hoboken, N.J.: Wiley. Retrieved from http://search.ebscohost.com.saintleo.idm.oclc.org/login.aspx?direct=true&db=nlebk&AN=382100&site=ehost-live&scope=site
Project Management Institute (PMI) (2017). A Guide to the Project Management Body of Knowledge (PMBOK Guide, eBook version, Skillsoft) – Sixth edition. Newtown Square
Project Management.com (2019). PRISM. Source from https://www.projectmanagement.com/tools/299473/PRISM
Ranasinghe, M. (1997) Risk management in the insurance industry: Insights for the engineering construction industry. Journal of School of Building and Real Estate, National University of Singapore. February.Source from https://www.pmi.org/learning/library/using-prism-model-improve-project-profitability-7799
