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Risk Management at Department of Defense


You work for a major defense contractor. Your company prepared and submitted a bid for a recent Department of Defense RFP, entitled Automated Mobile Defense System (AMDS). You have been assigned to lead Project X, which will design, develop, test, demonstrate and deploy 10 AMDS units to a location to be determined by the DoD assuming a successful demonstration. This project is expected to take at least 5 years to complete at a cost of $1.5 billion. If you are successful and deliver a quality product on time and within budget, the DoD will order 150 more AMDS units at a price of $10 million per unit. The goal of Project X is to develop a defense system to protect major and strategic cities within the US in the event of a missile attack from a hostile nation. It is to be a redundant system; the last in a series of defensive weapons to be used only in the event that all other defensive systems have failed; when enemy ABMs are approaching the US and only AMDS is left to take them down.

The conceptual design for the AMDS that your company submitted in response to the RFP consists of a mobile housing unit (MHU) containing 20 anti-ballistic missiles (ABMs) based on a radically new design; an anti-missile control computer (AMCC) used to automatically target and deploy the ABMs; and a retrofitted detection device (code name: SKYEYE) built on proven, patented radar technology which your company owns. All of these devices: the ABMs, the AMCC and SKYEYE will be completely housed in the MHU, which is planned to be an enhanced18-wheel tractor-trailer. A self-contained power source (for the ABMs) and solar charged batteries for the AMCC and SKYEYE make the entire AMDS portable and completely automatic (no personnel are required to operate any of the systems). However, military personnel on a regular basis will perform routine system monitoring and maintenance, preferably from a remote site. On-site maintenance should only be needed on rare occasions expected to arise from unforeseen events such as earthquake, tornados, ice storms, etc. Should it become necessary, military personnel will move the AMDS to a location known only to them. While it was not included in the design accepted by the DoD, your company would like to be able to provide additional capability with the system: they would like the AMDS to be able to operate while it is being moved.

You are the project manager and oversee the efforts of over a dozen nuclear scientists, engineers, and technology professionals. Many of them are acquainted with the rudiments of project management, but very few know much about project risk management. You'll need to do some education along with managing schedule, budget and scope.


Deliverable Length: 6-8 slides with notes
Details: Your discussion with the team went very well, and you present your plan to your manager in preparation for the formal presentation to the project stakeholders. She balks at the time and budget you've built in for risk management analysis and planning. "Don't you understand, time is of the essence here. The DoD gave us five years, but they are really expecting us to have the prototype built and tested within the year. We all know the risks - we don't need to or have the time to bother with a long, drawn-out risk management process."
You talk through your reasoning with her, which convinces her only to allow you to present a business case for the development of a risk management plan.

Using the Internet, research risk management practices. Build a persuasive case for "selling" the use of risk management for Project X to the project stakeholders. Keep your presentation at a high level but link the value of risk management to business objectives.

Objective: Use effective communication techniques.
Discuss the integration of risk management as a component into the total project management approach.
Communicate risk effectively to all project stakeholders

I am looking for assistance with this task on selling the concept or value of risk management but linking it to the business objectives. I understand that it should be sold based on how it will affect the bottom line of the project. For instance, we don't know if the suppliers, sub-contractors, engineers and others are going to perform effectively and efficiently and what other internal and external risks may arise so Risk Management planning is assessing the risk. But the objectives are somewhat unclear/vague so any assistance would be greatly appreciated. I have attached a sample of the importance of risk management to the field of Project Management.


Solution Preview

To build a persuasive case for selling the use of risk management for the above mentioned project to the project stakeholders and prove the value of risk management to business objectives, let us start with the general importance of project risk management.

Project risk management has become an inherent part of any project, whether big and small, now a days due to the current nature of business environment which is very fast, dynamic and is full of surprises and unforeseen events.

Systematic project risk management means advanced preparation and decision making for minimizing the consequences of possible adverse future events and, on the contrary, to maximize the benefits of positive future events. The present business environment is in many cases increasingly dynamic and a place of continuous changes. Project risk management has become one of the most important competence areas to obtain an improved understanding of the possible events, which can happen in this environment.Systematic project risk management is a competence area rather than a specific task for outside experts.


To convince a person which does not perceive the real value of project risk management, especially in light of its direct and indirect consequences on project's bottom line and ...

Solution Summary

Risk Management at Department of Defense