Chapter 7: Identifying Project Risks

Question 1

What is risk in project management?

Answer 1

Risk is an uncertain event or condition that, if it occurs, can have a positive or negative effect on project objectives.

Question 2

What is the Risk Management Plan?

Answer 2

The Risk Management Plan outlines how risk management activities will be structured, monitored, and controlled throughout the project.

Question 3

What is the Identify Risks process?

Answer 3

Identify Risks is the process of determining which risks might affect the project and documenting their characteristics.

Question 4

What are risk categories?

Answer 4

Risk categories group potential project risks into areas such as technical, external, organizational, and project management risks.

Question 5

What is a risk register?

Answer 5

A risk register is a document where identified risks, their causes, impacts, probability, and planned responses are recorded and tracked.

Question 5

What is the purpose of Qualitative Risk Analysis?

Answer 5

Qualitative Risk Analysis assesses the likelihood and impact of identified risks to prioritize them for further analysis or action.

Question 6

What is Quantitative Risk Analysis?

Answer 6

What is Quantitative Risk Analysis?

Question 7

What is the Probability and Impact Matrix?

Answer 7

A Probability and Impact Matrix is a tool used to prioritize risks based on their likelihood of occurring and the severity of their impact on project objectives.

Question 8

What are the four main risk response strategies for negative risks (threats)?

Answer 8

Avoid, Mitigate, Transfer, and Accept.

Question 9

What is the difference between qualitative and quantitative risk analysis?

Answer 9

Qualitative risk analysis prioritizes risks based on probability and impact, while quantitative risk analysis assigns numerical values to assess overall risk exposure.

Question 10

What is a risk response plan?

Answer 10

A risk response plan outlines strategies for managing identified risks, aiming to minimize threats and maximize opportunities.

Question 11

What are the risk response strategies for positive risks (opportunities)?

Answer 11

Exploit, Enhance, Share, and Accept.

Question 12

What is risk avoidance?

Answer 12

Risk avoidance involves changing the project plan to eliminate a risk or its impact.

Question 13

What is risk mitigation?

Answer 13

Risk mitigation involves taking steps to reduce the probability or impact of a risk event.

Question 14

What is risk transfer?

Answer 14

Risk transfer shifts the impact of a risk to a third party, typically through contracts, warranties, or insurance.

Question 15

What is risk acceptance?

Answer 15

Risk acceptance acknowledges the existence of a risk but chooses to take no proactive action unless the risk occurs.

Question 16

What is risk exploitation?

Answer 16

Risk exploitation involves ensuring that opportunities are realized by taking specific actions to increase the chance of their occurrence.

Question 17

What is risk sharing?

Answer 17

Risk sharing involves collaborating with a third party who has the expertise or resources to capture an opportunity.

Question 18

What is the Risk Breakdown Structure (RBS)?

Answer 18

The RBS is a hierarchical representation of risks, categorized by their sources or areas of impact.

Question 19

What is a contingency plan?

Answer 19

A contingency plan outlines actions to be taken if a specific risk event occurs, to minimize its impact.

Question 20

What is a fallback plan?

Answer 20

A fallback plan is developed for high-impact risks that may occur if the primary risk response is not effective.

Question 21

What is the Monitor Risks process?

Answer 21

Monitor Risks is the process of tracking identified risks, monitoring residual risks, and evaluating risk response effectiveness throughout the project.

Question 22

What is residual risk?

Answer 22

Residual risk refers to the risk that remains after risk response strategies have been implemented.

Question 23

hat is a trigger condition in risk management?

Answer 23

A trigger condition is an event or situation that indicates a risk is about to occur.

Question 24

What is secondary risk?

Answer 24

Secondary risks are new risks that arise as a direct result of implementing a risk response strategy

Question 25

What is the Risk Register Update?

Answer 25

Risk Register Updates involve changes to risk priorities, response strategies, or new risks added to the register as the project progresses.

Question 26

What is agile risk management?

Answer 26

Agile risk management involves continuous identification, assessment, and prioritization of risks in iterative cycles, allowing teams to adapt and respond quickly to changes.

Question 27

What is a bubble chart in risk analysis?

Answer 27

A bubble chart is a visual representation used in qualitative risk analysis to display risks based on their probability, impact, and other attributes like cost or time.

Question 28

What is a tornado diagram?

Answer 28

A tornado diagram is used in quantitative risk analysis to visually compare the relative importance of variables on a particular outcome.

Question 29

What is a decision tree in risk management?

Answer 29

A decision tree is a diagram that helps project managers assess risks by evaluating the various outcomes and their potential impacts.

Question 30

What is Monte Carlo simulation in quantitative risk analysis?

Answer 30

Monte Carlo simulation uses probability distributions to simulate potential outcomes and calculate the likelihood of different risk scenarios.

Question 31

What is influence diagram in risk management?

Answer 31

An influence diagram is a graphical representation that shows the relationships among variables, decisions, and risks affecting project outcomes.