2. Risk Assessment – Internal Project Risks

In this section, 20 internal project risks related to the implementation of Get-Revved Project are identified from literature. Then six of them are carefully chosen as the major risks, which are briefly discussed and explained in this section. The full list of 20 internal project risks will be registered in the next section.
2.1 Lack of a Change Management strategy
2.1.1 Justification for the risk
In order to successfully deploy CRM system, the company should have a fully documented project plan with milestones covering all change management aspects. The change management strategy should also support the technical and and business aspects of the CRM project implementation and the project team and project sponsors are able to review the implementation process regularly. A successful change management strategy covers stakeholder communication, analysis, engagement, policies, procedure and training.
The risk can not be overlooked when project plan is not fully documented or it is a bit weak on key dates, milestones and responsibilities. The fact that the change management aspects are not very strongly supported by top or senior management will significantly increase the overall risk.
Lack of a Change Management strategy will become a major risk when project plan only focuses on the technical aspects of the project and lack planning of any specific actions to ensure that change is sustained.
2.1.2 Impact of the risk
When CRM projects are mismanaged from change perspective, results and outcomes are not achieved. The impact of this risk includes rework required on design, loss of work by project team which may result in project delays, missed milestones and budget overruns. Among them, project delays and missed milestones are related to the constraint of time and budget overruns is related to the constraint of cost.
This kind of risk may also trigger other risks, such as active and passive resistance from stakeholders, resources becoming unavailable, obstacles appearing unexpectedly.
2.2 Lack of skills in the Project Team
2.2.1 Justification for the risk
During the initiation phase of CRM project, one crucial step is to assign a project team of specialists who should be involved in the planning and implementation effort. The project team must have balanced skills across functional and business processes, technical integration, and change management capabilities to mitigate this risk. The project team typically includes CIO or other IT executive, heads of sales, marketing and/or customer support, network engineer, business analyst, information security specialist, finance department representative and probably an outside consultant.
Assembling the right CRM implementation project team is a clear precursor to implementation success. Lack of any skills or roles in a project team will impose an extra risk to the implementation stage of the CRM project. For instance, because Get-Revved Project adopt a software as a service (SaaS) CRM solution, the importance of IT executive is easily underestimated. Without IT leadership and participation, technology alignment, data conversion, system integration, system administration, user training and troubleshooting will become difficult.
2.2.2 Impact of the risk
Without a well-balanced CRM project team, tasks in the implementation stage cannot be achieved in the project’s time frame and the quality defined in the scope constraint is detrimentally affected.
Due to the lack of specific skills and knowledge area in the project team, it will be difficult for the project manager to keep a tight enough rein on the situation and in make the most appropriate decision and in many cases resulting decisions will not align well with the firm’s original goals for the initiative.
This kind of risk will cause detrimental impact on the scope and quality of project during the course of the implementation at CarPart Productions.
2.3 Inadequate Top Management Support
2.3.1 Justification for the risk
CRM project is one of the projects that need redesigning business process and creating main change. Top management support plays a key role in the CRM project success. Adequate top management support can efficiently remove staff resistance against changes.
One article pointed out that in many organizations, CRM projects are likely to lose top management support once initial high-level decisions have been made. Senior managers tend to be either not engaged or loses interest on the project. They probably do not focus long enough time to ensure successful implementation operation.
Therefore, the risk of top management support should be carefully managed.
2.3.2 Impact of the risk
When top management support becomes unavailable, CRM project team can easily lose control and the separate offices and manufacturing plants of CarPart Productions can quickly become unaligned. Moreover, any attempt to change behavior through implementing process changes and software solutions will ultimately fail.
This type of management chaos will result in time delay of the implementation course of the project.
2.4 Misunderstanding CRM system requirements
2.4.1 Justification for the risk
CRM system can be treated as a multi-functional business application with the ability to maximize an organization’s interaction with current and future customers. By the help of the CRM system, employees from different departments within the organization can have a relatively clearer view of current business overview.
In order to guarantee that the CRM system is successfully adopted and used, it is really important to assess the requirements and understand the true need and requirements of the system. Through a clear requirements setting, the users of the CRM system will know what achievement should be fulfilled and what can be expected from it.
Fully understanding the requirements, purpose and objective of the CRM system and having a shared goal plays an important role in the implementation of the project. A clearly identified requirement has the ability to serve as guidelines during the implementation process, telling project team what needs to be done and how to carry out plans. It can also encourage activities and motivate team members of the project.
Lack of understanding or even misunderstanding the requirements may lead to catastrophe. For example, employees may have various ideas about requirements. Some may see CRM system as a tool to keep information structured. Others may treat it as an integrated database where statistic can be made easier. The lack of a clear, shared and correct vision of the project will probably result in difficulties in implementation or even rework and double the workload.
2.4.2 Impact of the risk
Understanding, gathering and managing CRM system requirements are important challenges in project management. Projects will fail due to poor understanding of requirements at any time throughout the project lifecycle.
The impact of lack of understanding the CRM system requirements will be magnified as the business analysis moves from high-level requirements towards functional and nonfunctional requirements.
Without understanding requirements clearly, out of scope problem is likely to occur. The requirements that has not been taken into consideration may be discovered, making the scope of project hard to define.
Due to the rework of functional requirements, additional cost will occur. The cost of changing functional requirements is the most significant one because the technical specification and design of the solution all depend on the definition of these requirements.
2.5 Inadequate funding for CRM
2.5.1 Justification for the risk
Critical Success Factors include the allocation of sufficient funding to project implementation. This means that appropriate resources are available when and for as long as required.
There is a high probability that CRM will fail if CRM project is regarded in the strategic plan of the organization without allocating enough funding and financial recourses for its implementation. As one of the articles pointed out, applying and implementing CRM project is very costly and needs about $ 60~130 million to be implemented.
2.5.2 Impact of the risk
Gaining adequate funding for CRM requirements is an important issue for organizations and companies, particularly as many of the CRM projects expanded dramatically in cost and scope.
Lack of enough fund is directly linked with budget overrun, which may result in the impact on the other two constraints. Due to the limitation of fund, the quality of the project defined in the scope can not be fulfilled. Inadequate funding may also result in frequent delays in deliverable completions.
2.6 Poor quality of legacy data
2.6.1 Justification for the risk
During the implementation of the CRM system, history data held by separate offices and manufacturing plants of CarPart Productions has to be electronically converted into the new CRM system.
The process involve customer data reviewing, filtering, de-duplicating and possibly appending before migrating data to the new CRM system. The implementation of data conversion usually requires data quality surveying and planning measures at the beginning of the CRM implementation project. Any issues regarding data accuracy, data relevancy, data consistency, data cleansing and data redundancy will cause data conversion delay.
2.6.2 Impact of the risk
One article stated that many CRM implementations incur an early project delay because of a failure to survey the data prior to the conversion. This is followed by the untimely discovery of dirty data, duplicate data, incomplete data and bogus data.
The poor quality of legacy data often results in added tasks to the project schedule for data conversion processes and puts the project team behind of schedule, which means that the expected time of the project has to be extended.
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