Medical Products Producing: Risk Management

📄 Words:	1688
📝 Subject:	Risk Management
📑 Pages:	6
✍️ Type:	Essay

Project Charter

Background

This project aims at producing a new device used in certain medical products and its effective marketing. The project is expected to help the organization to diversify its product range, enter new markets, and increase profits. Medical products have been in high demand in the USA, and technological (including computer-based) advances are valued in this sphere. However, this is quite a new area for the organization, so the project will require effective management, additional resources, and employees’ commitment.

Goals

The necessary volume of high-quality devices is produced within the established term
The organization has the necessary resources to start mass production of the device
All the necessary licenses are obtained within the defined period

Scope

The production of a new device is the end result of this project. The process will be divided into several phases including planning, prototype design and production, obtaining the necessary legal documents, preparation for the production, and the production of the device. The product marketing process is excluded from this project as this area will be the responsibility of another team. At that, marketing specialists will be involved in the process of the new product planning and development as their insights are instrumental in the successful implementation of the project.

Key People

Job	Responsibilities
CEO	Overall project supervision Assigning employees to key roles within the project team Strategic planning Focus on communication improvement
Project manager	Project planning Supervision over each stage of the project implementation Participation in the creation of the project team consisting of the employees from such departments as engineering, design, logistics, sales, production, marketing, purchasing, and production Reporting results to the CEO and top management
Quality manager	Control over all processes Ensuring the manufacture of a high-quality product Reporting any concerns or issues to Project manager
Project team	Participation in the project plan development Implementation of the project

The project team will include the employees from the departments mentioned above, and these people will collaborate during the planning and implementation stages. The representatives of the departments will focus on the scope of the work of their structural units. For instance, marketing manager will ensure that the product will be effectively promoted and sold, and it has the necessary features to become successful in the market.

Project Milestones

The project will be implemented within 12 months starting from December 1, 2018. The mass production and the associated testing will be implemented during three autumn months in 2019 (see table 1).

Project Budget

The preliminary estimation of the costs indicates that the overall budget for the project will be $100,000 (including the development of the prototype) (see table 2). The number of the boards produced within the scope of this project will be 20,000 items. The implementation of this project will require the acquisition of new equipment and software, as well as staff training. The involved people will participate in the project and simultaneously continue working on their current tasks. Although no additional staff will be hired and no considerable funds will be allocated to pay additional salaries, certain bonuses and perks should be provided so some investment in human resources should be considered.

Table 2. Preliminary Budget.

Activity	Cost, USD
Prototype design and production	10,000
Equipment investment	10,000
Materials and testing	40,000
Labor costs	30,000
Legal documentation application process	10,000
Total	100,000

Constraints and Assumptions

Various factors are likely to have an impact on the project implementation process. First, the lack of well-established communication channels and communication competency can have adverse effects on the project. This area needs specific attention, and extensive training, as well as the development of the corresponding culture, is necessary. Secondly, the employees (key stakeholders) do not have experience in working on such projects as all new products development projects were managed by hired consultants.

In addition, no devices for medical equipment have been produced, so people lack knowledge and skills in this area. Employees’ motivation to perform properly can be low as they will have to focus on their current tasks instead of investing all their time in the project. The company will also have to allocate certain funds to ensure the successful management of this project, which can be difficult due to the existing economic challenges.

This project relies on a set of assumptions that include the presence of strong leadership, vision, and overall readiness for changes. The company’s top management has a clear vision that is properly communicated. It is also acknowledged that the organization needs certain transformations related to communication competency development. The company has the necessary resources including funds, equipment, and manpower to successfully manage the project. The employees do not reveal their negative attitudes and can be interested in participating in the project. The new product is likely to be marketed effectively, which will ensure meeting the established goals.

Project Risks Spreadsheet

The implementation of any project is associated with a variety of risks that should be considered. It is essential to identify the most serious issues that may happen in order to come up with an effective risk management plan. Although the organization does not have a sound risk management planning culture, a risk management plan will be created for the project in question. This plan will ensure the successful implementation of the project as the project team will be ready to address the challenges that may hinder the success of the new product development.

Category	Risk	Description
Schedule	Obtaining license	In order to obtain the necessary legal documentation, certain procedures will be carried out, so some time can pass. There are chances that due to delays in production the process of obtaining licenses can take more time.
	Receiving prototype	The company working on the prototype may fail to follow the set timeline. Lectocomp Manufacturing can receive sketches or prototypes that will not satisfy their needs, which will lead to a longer period of prototype development, which, in its turn, will result in postponed deadlines of the product manufacture.
	Producing the device	Manufacturing of a product that is quite new for a company is often associated with such risks as issues with components, staff incompetence, the lack of equipment. Production process will require contracting new partners that can also lead to some delays and unexpected costs. It can be quite difficult to locate the best suppliers at once.
People	Low performance	Although people do not reveal their dissatisfaction with the new product development process, their performance may be quite low due to their involvement in other projects. The insufficient commitment of employees can lead to delays or other issues.
	Poor communication	The project requires a close collaboration of the representatives of different departments. However, communication competence is one of the weaknesses of the organization. The lack of communication skills and proper communication channels may result in delays, inadequate implementation of certain stages, or even the overall project.
	Insufficient training	The new product is related to the medical sphere, but the vast majority of employees have no experience in working on such projects. Medical equipment is quite specific, so employees may make errors that have adverse effects on the planning and production processes.
Strategy	Too difficult to implement	The company’s top management has a vision and set quite clear goals. However, the implementation of the project may be too complicated and associated with the challenges the organization will be unable to address. The lack of communication competency, the need to adjust the existing equipment and train staff, as well as the lack of experience in working on medical equipment or components can prevent the project team from successful management of the project.
Cost	High production cost	The manufacture of the new product may require certain (or substantial) investment into additional equipment or upgrading the existing facilities. Furthermore, the staff may need some training that will also increase the costs. High costs and, hence, high prices, may drive potential customers away.
Cost	Expensive components	The production of the new device may require the use of expensive components, which will result in the increase in costs. The use of some components may be associated with the risk of delays due to unavailability of some materials.
Legal	Contract risks with the prototype developer and suppliers	There is a risk of litigation with the prototype developers and/or new or existing suppliers. The partners can fail to provide the products and services according to the contracts, while Lectocomp Manufacturing may fail to provide the agreed payment.
Legal	Issues with obtaining license	The process of obtaining licenses or other documentation may be quite complex. The organization may need to change certain standards, equipment, procedures, and processes in order to obtain permissions. The inability to meet all the requirements may result in no licenses and poor marketing of the new product.
Market	High competition	The healthcare market is characterized by high profits and high competition. It can be difficult to enter new markets, so the project will not meet its primary goals. The need to compete with other companies may force Lectocomp Manufacturing to reduce costs, which may lead to damage to the product’s quality and its potential success.
	Insufficient demand	It is essential to ensure that the new device will be in demand, but it can be difficult to achieve this objective due to the competition in the market. The companies operating in this market may introduce similar products that will be sold more effectively due to these organizations’ reputation.
	Possible substitution	The US healthcare system relies on advanced technology, so various high-technology products appear every day. During a year, new technology can be developed, and the device will be regarded as outdated or even unnecessary.
External	Natural disasters	Such natural disasters as floods and storms can lead to substantial damage to the facilities, and hence, can result in higher production costs, delays, and even inability to complete the project.
External	Manmade disasters	Arsons, terrorist attacks, damage to the infrastructure can also lead to certain risks to the project implementation.

Approval Signatures

CEO_______________________.

Project Manager_______________________.