The main objective of this project is to renovate homes to reduce the cost incurred in buying new ones. There are however, risks that face the undertaking. This analysis lists all the risks that the project is likely to face.
Investing in the project - There is no guarantee that the approached customers are willing to contract the company. The time factor will increase during negotiating and closing a deal with the customer. In the probability and impact matrix, this poses a threat to the project.
Having unqualified staff - To make a project a success, it has to be carried out by professionals with the relevant experience, skills and expertise. However, this is achieved at an extra cost. The time required to complete the project therefore, increases as vetting of the qualified staff takes time. After this is done successfully the final output is guaranteed to be of high quality (Dan, 2000).
Unreliable contractors - Once a tender is put in the public domain, the host company has not control on the applicants. Other than regulating the qualifications of the applicants, the project leaders may not have detailed background information about the contractors. This may have a negative or positive feedback towards the company’s ability to close contracts. Negative feedback will make customers lose confidence in the firm and therefore this risk factor needs addressing (Dan, 2000).
Legal requirements - The Company must be certified that it can offer quality service to its customers. The law also affects the operating environment of the project. Its implication increases the monetary value of the project (Paul, 2010).
Acquiring new designs – This is inevitable as change in construction design occurs daily. Time has to be invested to come up with new designs and these results to an added cost. This may be seen as a threat to the operating cost of a company as it adds overhead cost.
Well evaluated output - This ensures that the quality of work done utilizes employees optimally. A top of this, the quality of output earns the firm a reputation in the market and therefore it is able to effectively cope with competitors. During this period, the firm is able to determine its price in the market (Chapman, 1997). Failure to address the valuation of work, the quality of output will be poor.
Dealing with consultants - The quality of service offered by them is of high quality and therefore improvement in the design of homes can be highly influenced by their presence. They offer new ideas thou at an extra cost to the project (Paul, 2010).
Acquiring the relevant materials needed for construction - With the global inflation the cost of building materials has hiked. Trying to acquire new materials at a reduced cost threatens managerial decisions in terms of prioritization. The implication of this is that the probability of convincing users to renovate their houses lowers. As a result, it poses the threat of losing new customers (Chapman, 1997).
Maintaining customer confidence - The project manager must endeavor to enhance public relation to ensure that the reputation of the company in providing quality to it members is maintained. If this is not done the company will lose consumer confidence in the long run.
Unpredicted and fluctuating markets - Since no firm is a monopoly in the market, prices set by other firms who may have an added advantage in production may adversely affect the company. This may force the company to lower its quality level to survive in the market.