Great Northern Hotel Refurbishment Project Construction Essay

Great Federal Hotel Refurbishment Project plait EssayA encounter instruction make known was undertaken to determine authorization endangerments that may run alongside the overhaul of Great Northern Hotel. The chief(prenominal) executive of RAM-led consortium, which has been selected by Kings Cross Central to refurbish the Great Northern Hotel, appointed our police squad to describe, analyze and develop proper recommendations for managing potential run a risks.Our police squad used a cause-effect summary based on a deal of conclusions identified after several meetings with experts and think sessions to highlight argonas of practical business for the date. Another method used was to analyze historical records and subjects from preliminary grammatical formula hurtles.The results of the reputation outline the fact that, without an accurate risk management utilize in the lead setting the baseline for the externalise, various factors may affect the general du ration and the necessary budget to refurbish the Great Northern Hotel.2. innovation AND METHODOLOGYThis report was requested by the chief executive of RAM-led consortium, forward the beginning of Great Northern Hotel regaining. Our police squad was asked to submit its findings by twenty-sixth of May, 2010.The purpose of this report is to investigate what are the realistic threats for this restitution depict and to analyze how their tinct loafer be minimized. Our squad has responded to this request by growth a list of potential risks that might affect the restoration bug out and by carrying out a thorough risk analysis, as understanding the nature of risks is a precondition for a proper response, and also by suggesting appropriate recommendations for minimizing negative impact on the project. The objective of this report is not to eliminate risk or uncertainty, but to take a fundamental look into the future of the renovation project and to identify possible threats.By risk, our team understands the possibility of several(prenominal)thing happening that lavatory affect the prospects of achieving project goals (Maylor, 2003, varlet 192). Nevertheless, our team also took into consideration several other risk definitions, all of them underlying the same idea. Some examples of definitions our team has worked with are listed yellRisks are those factors that may cause a disaster to meet the projects objectives ( slay, 2003, foliate 253)Risk is the expected consequences of an event and the probability that the event might occur (Kendrick, 2003, scalawag 2)The possibility of suffering harm or loss (Maylor, 2003, page 192)Considering its limitations of identifying all risks that might affect the refurbishment project as it is virtually impossible to foresee all future events our team used these definitions in order to outline major areas of risks for twirl projects, especially for the refurbishment project.To take risks, our team applied the ris k management plan proposed by murder (2003), which complicated the following goIdentify and categorize risksQuantify and rate risksDevelop risk response/managing risksRisk identification is considered to be the closely signifi coffin nailfult part of risk management process (Burke, 2003), as risks that are not identified can claim negative consequences on the project. For this step, our team chose to consider sixfold techniques in outlining major areas of risk for the refurbishment project. Our main method implied categorizing risks, as this method can lead to the identification of precise problems (Kendrick, 2003). Our team mainly looked at projects objectives to define potential external and inborn sources for risks.In doing this, our team focused on some of the methods indicated by Burke (2003), such as having meeting with experts and with members of the force to share risks experiences as previous experience can support to risk identification -, having constant bra instorm sessions and also analyzing historical records and reports on previous body structure projects. later on stack a style results from the methods mentioned, our team applied a cause-effect analysis to identify risks for the refurbishment project.After having identified a range of potential risks, our team tried to respect the impact they could have on the project. Assessing how likely an event is to occur and determine the extent of the effect of the event (Maylor, 2003, page 195) is known in project risk management as risk quantification procedure. Risk quantification also implies depute a risk priority analysis (Burke, 2003), in order to move over what areas of risks to address first. For this maneuver, a Probability/ relate ground substance has been created to card the aim of risk and to prioritize potential risks.Final step undertaken by our team was to develop responses for the identified risks. In risk management, after identifying risks, they can all be reduc ed or mitigated in some way (Maylor, 2003). There are several procedures to respond to risks (Burke, 2003), among whichEliminate risks avoiding the risk by removing cause (Burke, 2003, page 262)Mitigate risks reducing risk probability and impact (Burke, 2003, page 262)Deflect risks transfer the risk to another party (Burke, 2003, page 263)Accept risksAs eliminating risks completely cannot always be a happy procedure, our team has chosen to combine the above mentioned procedures and offered solutions for eliminating, mitigating and rejecting risks.3. FINDINGS3.1 GENERAL CONSTRUCTION RISKS onwards listing the results of the analysis undertaken for the refurbishment project, this report will outline some of the risks that are generally affecting construction projects. This information will contribute to a better understanding of potential risks a construction project may imply and it can influence part of the decisions concerning further risk monitoring and control for the refurbi shment project.Based on data roll up from meetings with experts and with members of the military unit, from brainstorming sessions and from the analysis of antithetic reports of previous construction projects, out team concluded that there are several ways of classifying risks in construction projects.Our team has e projectated the following classification to underline possible areas of risks for construction projectsFinancial risks which can include labor and stuff work or extra charges from declarers or suppliersTime risks which can include delays caused by different factors, major discrepancies amid gauge and actual durationsTechnological risks which can include misinterpreted construction procedures or design assumptions or unintentional site conditionssocioeconomic factors such as environmental organizations or economic instability organizational factors such as communication between workers, dealual relations available risks such as construction defects, labor r isks, fictional character insufficienciesGenerally, data examine revealed the fact that construction projects are more inclined to risks, as they rely on multiple factors to achieve their goals, such as visible suppliers, labor force, site conditions, quality surveillance and fixed budgets. Moreover, results also suggested that construction projects have a higher degree of uncertainty than other types of projects, as they can be easily influenced and affected by weather condition or political and economic climate.The conclusion our team reached is that the refurbishment project can also be affected by the above mentioned factors and that a expand risk management plan is compulsory to be developed for the project to reach its goals.3.2 IDENTIFYING RISKS FOR REFURBISHMENT PROJECTResults collected from our meetings with experts and personnel members, from our brainstorming sessions and from the analysis of previous reports on construction projects indicated that for the refurbishm ent of Great Northern Hotel multiple areas of risks should be taken into consideration.From the areas identified, our team will outline through this report the first major categories of risks that could affect the refurbishment project. These categories areTime risks toll risksQuality risksA cause-effect analysis has been undertaken in order to identify sequence, cost and quality risks by considering the objectives of the refurbishment project. The findings are listed in the following pages.For a better understanding of our analysis, our team included the objectives of the refurbishment project. The project has three main objectivesRefurbish the Victorian-build Great Northern Hotel by early 2011Constructing a new boutique hotel, with 94 luxury bedrooms, a take out and a restaurant by late 2011Open the hotel in season for capital of the United Kingdom Olympics 2012By applying a cause-effect analysis, our team identified risks on time, cost and quality, their causes and effects. T he risks are listed in the following pagesI. Time risks unsafe delays in refurbishing the hotelMajor differences between estimate time and actual time in constructing the new boutique, the bar and the restaurant rarified opening postponed with two monthsWorkers strikeCausesPersonnel causes illness, deaths technological problems problems with work equipmentProblems with suppliers equipments not delivered on timeWeak communication among personnelChanges in contract between client and contractorLack of risk management among workersOrganizational culture conflictsWeather volatilityLack of expand work plans from contractorNecessary approvals not given on timeEffectsSevere delaysSlow comeDelays in money allocation for work equipmentProject failureII. Costs RisksInsufficient budget for refurbishmentHigher cost for construction of new boutiqueCurrency variationHotel not opened in time for the OlympicsCausesIncreases in labor and worldly costs from suppliersHigher bills from contract or on work progressInstable deliveryEmergency situation, such as extra equipment or extra personnelEffectsOver-budgetSlow progressActivity stoppedProject failureIII. Quality risksPoor create condition number one quality refurbishmentWeak structure for new constructionLaw quality of material usedCausesUnstable structure of old buildingLack of professionalism mistake of work tasksIncorrect design assumptionsEffectsDelays caused by additional deedsObjectives not achieved on timeOver-budgetProject failureRISK QUANTIFICATION next step undertaken by our team was risk quantification, in order to measure risks probability and to establish their priority. This report includes a Probability/Impact hyaloplasm for the risks identified.The Matrix has been developed using the analysis results following our meetings with experts and staff members, our brainstorming sessions and from the analysis of previous reports on construction projects.Risks Probability/Impact Matrix Probability and Impac t have been rated on a scale from 1 to 4, where 1 = Unlikely/Minor, 2 = Possible/Moderate, 3 = Likely/Major, 4 = Almost certain/CriticalRisksProbabilityImpact1. Severe delays in refurbishing the hotel342. Major differences between estimate and actual time in constructing new boutique, bar and restaurant233. high-and-mighty opening postponed with 2 months224. Workers strike215. Insufficient budget for refurbishment236. Higher costs for construction of new boutique227.Currency fluctuation218.Hotel not opened in time for the Olympics349.Poor building condition3410.Low quality refurbishment1211.Weak structure for new construction2312.Low quality of materials used11By rating Probability and Impact for the identified risks, our team also prioritized them, as followsI. Major risks (Major Impact, Likely Probability)Severe delays in refurbishing the hotelHotel not opened in time for the OlympicsPoor building conditionII. Moderate risks (Moderate Impact/Possible Probability)Major differences between estimate and actual time in constructing new boutique, bar and restaurantGrand opening postponed with 2 monthsInsufficient budget for refurbishmentHigher costs for construction of new boutiqueWeak structure for new constructionIII. Minor risks (Minor Impact/Unlikely Probability)Workers strikeCurrency fluctuationLow quality refurbishmentLow quality of materials usedRISK reply AND RECOMMENDATIONSBased on the results of risk identification, quantification and priority, our team makes the following recommendationsFor eliminating risks, the client/contractor shouldObtain necessary approvals before starting the refurbishmentCheck material quality before beginning the refurbishmentBefore signing contract with suppliers, include statements on fixed costs and material delivery inventory/replacementHave more meetings between client and contractor before signing the contract, to clarify each detailSeverely check workers priming before hiring themFor mitigating risks, the client/con tractor shouldName a risk management committee and include a risk management plan tolerate out condition surveys and measure surveys to establish building condition elucidate a risk management plan focused on individuals admonisher timetables and ask for weekly detail work plans and proof on progressInclude weekly quality controlsAllocate extra money for unplanned events in the tendering periodInclude morning meetings with workers to explain details on tasksOffer common lunch for workers to improve communicationFor deflecting risks, the client/contractor shouldHire an Audit company to keep track of accuracy in billings and work progress4. CONCLUSIONSThis report outlines what potential risks can a refurbishment project encounter alongside its duration. By using appropriate methods for identifying the risks and their causes, the report highlights what impact these risks can have on the project and to what extent they can be measured and prioritized. The report also includes a set of r ecommendations for eliminating, mitigating or deflecting potential risks.By making this report, our team reached the following conclusionsMost decisions in construction projects are based on incomplete information with an associated take of uncertainty about the outcome (Burke, 2003, page 252)In construction/ refurbishment projects, level of uncertainty can reach a high level in multiple areasNo project should start before developing a risk management planManaging risks should follow fixed steps Identification, Quantification, Prioritizing and Risk response and use as many sources as possible when reaching these stepsRisk response should combine different procedures to eliminate, mitigate, deflect or accept risksBefore deciding for one of these procedures, a cost/benefit analysis should be undertakenFor refurbishment projects it is very difficult to identify all risks, as they are more inclined to risks than other types of projects and can be easily affected by politics or by eco nomic climateThis report also includes outputs from Microsoft Projects on project scheduling, resources, task and finances developed by our team, in the Appendices chapter.This report counts 2365 words.