AU Analyzing Positive and Negative Risks Discussion

Discussion: Due 03/24

When choosing between multiple projects, a project sponsor must analyze each project to determine which one is most likely to yield the greatest benefit to the company. One way of doing this is through calculating expected monetary value (EMV), which is a form of quantitative risk analysis.

Review the section in your textbook on calculating EMV. Then, consider the following scenario:

Carrie’s IT firm has been invited to bid on WiFi projects at two universities identified as university 1 and university 2.  Carrie has some experience working with each university and prepared the following:

University 1 – Our firm has an established relationship with university 1. Based upon that relationship, I feel that we have a 75% chance of winning the contract and realizing a profit of $20,000. If we do not win the contract, we will spend approximately $40,000 for engineering a wireless solution and preparing the bid proposal.

University 2 – We have done some work at university 2, but they have also used several other vendors. Being a much larger project, we could realize a $600,000 profit but I estimate our chances of winning the bid at 50%. University 2 is considering requiring a wireless survey as part of the bid. I figure there is a 20% chance this will be required and it will cost the firm $120,000 to complete the survey and prepare the bid. There is a 30% chance that we won’t have to do the wireless survey and that we won’t get the project. Should this happen, we would lose about $50,000.

Use the following decision tree to address the questions, below:

• picture here
• Calculate the EMV for each project

Identify which project is best, based on EMV alone

Explain why you might choose the other project, despite the lower EMV

State which project you would ultimately recommend, and why

Each team member should provide a post addressing all of the items above. Your initial post must be a minimum of 200 words, and be supported by at least one professional or academic source.

• Assignment Due 03/28
• Analyzing Negative and Positive Risks
• [WLO: 1] [CLOs: 1, 2]
• Like any project, IT projects are likely to face several risks. Review the section in your textbook on the four basic risk response strategies for negative risks, and the four basic risk response strategies for positive risks.

Then, consider the project described in the Week 2 Assignment, of a company building a new divisional headquarters. Discuss two negative and two positive risks that the IT portion of this project might face. Then, using the basic risk responses strategies outlined in your textbook, choose the risk response that you think will best address each risk. Finally, explain why you chose this response over one of the other responses outlined in the textbook.

The assignment

Must be 900-1200 words in length (not including title and references pages) and formatted according to APA Style (Links to an external site.) as outlined in the Writing Center’s APA Formatting for Microsoft Word (Links to an external site.) resource.

Must include a separate title page with the following:

Title of paper in bold font

Space should appear between the title and the rest of the information on the title page.

Student’s name

Name of institution (University of Arizona Global Campus)

• Course name and number

Instructor’s name

Due date

Must use contextual (Level One) headings to organize your paper and your thoughts.

Must use at least two scholarly sources in addition to the course text. 

The Scholarly, Peer-Reviewed, and Other Credible Sources (Links to an external site.) table offers additional guidance on appropriate source types. If you have questions about whether a specific source is appropriate for this assignment, please contact your instructor. Your instructor has the final say about the appropriateness of a specific source for a particular assignment.

Must document any information used from sources in APA Style as outlined in the Writing Center’s APA: Citing Within Your Paper (Links to an external site.) guide.

• Must include a separate references page that is formatted according to APA Style as outlined in the Writing Center. See the APA: Formatting Your References List (Links to an external site.) resource in the Writing Center for specifications.

Carefully review the Grading Rubric (Links to an external site.) for the criteria that will be used to evaluate your assignment.