Altex Corporation Case Study – BUS 697

Altex Corporation Case Study Summary

The quest for progress through technological innovations and novel inventions has long served as a defining characteristic of modern life in the period following the end of the Second World War (1939-45). Fear and mistrust among Allied powers resulted in concerted efforts, by members such as the United States (U.S), to clamor for the establishment of Research and Development corporations in order to remain ahead of emerging rivals. Altex Corporation is one such organization that has carved out a niche in the development of advanced weaponry and recently awarded a contract for the Advanced Tactical Missile Program (ATMP) by the US Army.

However, an overall inadequacy in the provision of sufficient information resulted in the company leaving out important information about potential risks associated with the project. Altex Corporation employed this approach to primarily guarantee its future relationship with the US Army. Risk management was blatantly disregarded due to the nature of competitiveness within the sector. This paper will, therefore, evaluate the main reason why a risk management plan was avoided, risk management planning, customer-contractor expectations, project funding, army’s response, and a justification for risk planning.

Why was a risk management plan considered unnecessary?

Risk refers to any form of uncertainty likely to emerge during the course of an organization’s procedures. They are typically likely to have an impact on projected revenue and outcome which is why organizations are advised to develop robust risk management approaches (Hillson, 2012). Risks are an inevitable reality which organizations now have to contend proactively through the application if appropriate risk management plans. In this particular case, a risk management plan was deemed unnecessary since Altex Corporation wanted to continue doing business with the US Army in the future. The identification of potential risks is important in crafting a fitting methodology to respond to future risks through acceptance, evasion, allotment, or transference.  

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Should risk management planning be performed in the proposal stage or after contract award, assuming that it must be done?

The planning stage represents the most important phase during the commencement of a project. Nevertheless, questions have always been raised regarding whether risk management should be performed during the proposal stage or after a contract is awarded. In this regard, risk management planning should be conducted during the proposal stage since it represents a formative stage where extenuation strategies become necessary. It is usually during this phase that basic requirements for the business are outlined and how best to respond to any unforeseen circumstance likely to emerge. The proposal phase also includes a breakdown of a feasible response given the magnitude of the risk faced.

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Does the customer have the right to expect the contractor to perform risk analysis and develop a risk management plan if it is not called out as part of the contractual statement of work?

It is noteworthy to acknowledge that customers have a right to expect the contractor to perform risk analysis and participate in the creation of a risk management plan when implementing. This is particularly important since they are active participants in a project with specific needs which should always be met. Addressing customer-contractor expectations creates a sense of transparency and goodwill between both parties which often serves as a precursor to commendable ethical behavior. Trust then cements the relationship through a concise demonstration of reliability in business processes. The elimination of a risk management plan by Altex Corporation is an indication of low ethical standards within the company which should be addressed promptly to avert future problems.

Would Altex have been more interested in developing a risk management plan if the project were funded entirely from within?

Typically, financing is at the center of any project and the reason why it is underscored when developing a workable scheme. I opine that Altex Corporation would have been more interested in developing a risk management plan if the project had been funded entirely from within. This is solely due to the fact that this framework requires a fund director to coordinate fundamental activities, systems, and procedures. They also participate actively in outlining possible pitfalls which the company ought to look out for in order to manage risk effectively.  Frequent briefings area also significant in keeping fund directors updated; allowing them to properly analyze risks while relying on advice on how best to respond in given scenario.

How might the Army have responded if they were presented with a risk management plan early during the R&D activities?

Altex Corporation deliberately failed to address risk management planning due to far-reaching consequences which would have become apparent when presented. The introduction of a risk management plan early during the R& D plans would have resulted in the US Army halting the project to address emerging concerns. This may have been facilitated by an inadequacy in clear stipulations for project outcomes.  A risk management plan is also crucial when determining the success rate of a project within a given sphere. The identification of risks may have been crucial in influencing the US Army’s participation or withdrawal from the project, which is why it was avoided by the organization.

Read also Risk Avoidance Plan Topics Discussed

Can risk management planning be justified on almost all programs and projects?

The implementation of a risk management plan is justifiable for all projects. Both short-term and long-term projects require a risk management plan with appropriate tools to manage potential effects. A risk management plan offers a unique perspective to executives tasked with managing potential uncertainties and accompanying effects (Ayers, 2019, p. 77). It is justified during the commencement of any project as a fitting strategy of preparing for what may emerge in the near future. This insight allows leaders to identify areas requiring immediate action to foster ideal decision-making while significantly lowering risks.


            The strategic planning process is an important methodology which should always be considered by organization. Effective management of possible risks, therefore, assures organizations of the best possible outcomes especially when backed by unbiased decisions (Wanner, 2013). Altex Corporation’s failure to extensively explore potential risks represents a miscarriage in management, a display of unethical behavior which failed to accord customers with an opportunity for their needs to be addressed.

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