14 - Project Risk Management Terminology Flashcards
Analytical Techniques
Techniques used to evaluate, analyze or forecast potential outcomes based on project variables and relationships among those variables.
Contingency
A possible event that could negatively impact the project and is typically neutralized by accessing the schedule or budget reserve established for that purpose.
Contingency Allowance
An allowance or reserve, typically related to the budget or schedule, set aside to compensate for unanticipated events.
Contingency Reserve
Funds set aside for unforeseen events that can negatively effect the project.
Contingent Response Strategies
The tactics that will be employed if a specific risk trigger occurs.
Data Gathering and Representation Techniques
The collection, organization, and presentation of data and information.
Decision Tree Analysis
A technique used to assess possible responses to a threat or opportunity in order to make the best decision; it involves diagramming the options and notating the expected monetary value (EMV) potential of each option.
Document Analysis
The evaluation of current documentation related to project risk.
Expected Monetary Value
A statistical technique, typically applied in decision tree analysis, used to determine the average outcome when contingent scenarios for future project risks must be considered.
Fallback Plan
The plan that will supersede the original plan if it is not effective.
Identify Risks
The process of identifying the risks that can impact the project and documenting their attributes.
Implement Risk Responses
The process of determining the actions that will be taken should a threat or opportunity arise within the project.
Management Reserve
Funds set aside for unanticipated project work and excluded from the performance measurement baseline.
Modeling
The process of evaluating various situations represented in the model in order to determine their impact on the project.
Monitor Risks
The process of monitoring the implementation of risk response plans, tracking identified risks, identifying and analyzing new risks, and evaluating risk process effectiveness.
Monte Carlo Simulation
A process that simulates possible project schedule or cost outcomes; often used to estimate required reserves based on the scatter diagram or probability table that is typically the output of the process.
Multi-criteria Decision Analysis
A process that utilizes a decision matrix to systematically analyze project information such as risk levels, uncertainty, value, and prioritization.
Opportunity
A risk whose occurrence will result in a positive impact on the project.
Overall Project Risk
The impact that uncertainty, including the cumulative effect of individual risks, has on the project; the exposure of stakeholders to the implications of variations in project outcome, both positive and negative.
Perform Qualitative Risk Analysis
The process of ranking risks for additional evaluation based on the probability of each risk and the impact on the project if the risk occurs.
Perform Quantitative Risk Analysis
The process of numerically evaluating the impact of identified risks on the project.
Plan Risk Management
The process of determining the methods that will be used to execute project risk management activities.
Plan Risk Responses
The process of determining the actions that will be taken should a threat or opportunity arise within the project.
Probability and Impact Matrix
An array used in qualitative risk management to prioritize risk, typically based on each risk’s probability of occurrence and potential impact.
Project Risk Management
The process required to plan for, determine, evaluate, respond to, and control potential or actual project threats and opportunities.
Quantitative Risk Analysis and Modeling Techniques
Common approaches to producing a more detailed evaluation of project risk; techniques include expected monetary value (EMV) and decision tree analysis.
Reserve
Funds set aside for risks to the budget or schedule, for example management reserves or contingency reserves, as provided for in the project management plan.
Reserve Analysis
An analysis technique used to identify the critical features and relationships of components in order to determine the amount of reserves realistically needed for the project with consideration of schedule duration, budget, and cost estimation.
Residual Risk
The remaining risk following the implementation of risk responses.
Risk
An unscheduled, but possible, event that may have a positive or negative impact on the project if it occurs.
Risk Acceptance
A risk response strategy that involves acknowledgment only of the risk; no planned response is formulated unless the risk occurs.
Risk Appetite
The amount of uncertainty an organization or individual is willing to accept in anticipation of a reward.
Risk Audits
The evaluation of project risk responses to determine the effectiveness of the utilized approach to risk.
Risk Avoidance
A risk response strategy that involves the elimination of the threat or protection of the project from the impact of the threat.
Risk Breakdown Structure (RBS)
A representation of risks ranked by category.
Risk Categorization
The organization of risks by source or other criteria to increase understanding of overall project risk.
Risk Category
A class of risks, such as organizational risks or market risks, defined by its potential cause.
Risk Data Quality Assessment
An evaluation of risk-associated data to determine its quality.
Risk Database
A data repository that stores and manipulates information associated with the risk management processes.
Risk Enhancement
A risk response strategy that increases the probability of occurrence or impact of an opportunity as a result of deliberate team action.
Risk Escalation
A risk response strategy that transfers ownership of the risk from the project team to a higher organizational level for more effective management.
Risk Events
Events that may impact the project (either negative or positive).
Risk Exploiting
A risk response strategy that ensures the occurrence of an opportunity as a result of deliberate team action.
Risk Exposure
A quantified potential for loss or gain at any given time during the project.
Risk Factors
Numbers representing the risk of certain events, the likelihood of their occurring, plus the impact on the project (if the event does occur).
Risk Management Plan
The document, part of the project or program management plan, used to describe the manner in which risk management activities will be framed and executed.
Risk Mitigation
A risk response strategy that involves the reduction of the threat or the probability that the risk will occur.
Risk Owner
The person responsible for the monitoring of a risk and for the determination and implementation of an appropriate risk response strategy.
Risk Register
A document that lists each risk along with the results of its analysis and risk response planning.
Risk Reassessment
The process of identifying new risks, reassessing risks that have already been identified, and closing of expired risks.
Risk Report
A project document that establishes the progressive development of risk management processes throughout the project, summarizes individual project risk information, and delineates the degree of overall project risk.
Risk Review
A meeting used to examine and document the effectiveness of risk responses in relation to identified, individual project risks and to overall project risk.
Risk Seeking
Possessing a higher tolerance than most for risk.
Risk Sharing
A risk responses strategy that allocates ownership of an opportunity from the project team to a third party who is best able to capture the benefits of that opportunity.
Risk Symptoms
Characteristics which indicate that a risk event is possibly starting to occur; could also be called risk triggers.
Risk Threshold
The degree of risk exposure that defines the upper limit of risk acceptance; risks whose level exceed the threshold must be addressed.
Risk Tolerance
The level of risk that an individual or organization is willing to permit; also known as risk utility.
Risk Transference
A risk response strategy that involves shifting the impact of a threat, as well as accountability for the response, to a third party.
Risk Urgency Assessment
The evaluation of risk responses to determine priority in order of timing.
Risk-averse
Possessing a low desire or tolerance for risk.
Risk-neutral
A middle ground between the risk taken and the benefit received.
Root Cause Analysis
An analytical technique used to ascertain the fundamental reason a variance, defect, or risk exists.
Secondary Risk
A risk that results from a risk response implementation.
Sensitivity Analysis
A quantitative risk analysis and modeling technique used to identify those risks that have the greatest effect on the project.
Simulation
A project computer model that can counterfeit the project outcome when there is uncertainty associated with schedule, cost or resources.
Strengths, Weaknesses,
Opportunities, and Threats (SWOT) Analysis
A risk analysis technique which considers the strengths, weaknesses, opportunities, and threats of the project to facilitate a more knowledgeable risk management analysis.
Threat
A risk whose occurrence will result in a negative impact on the project.
Trigger Condition
An indicator that a risk event could occur.
