Project Risk Management

Question 1

Risk:

Answer 1

An uncertain event or condition that, it if occurs, has a positive or a negative effect on a project’s objective.
Or uncertainty of outcome

Question 2

Characteristics of Risk:

Answer 2

1) A definable event
2) Probability of occurrence
3) Impact (consequence) of occurrence

Question 3

Risk Management:

Answer 3

Manage a project’s exposure to risk. The aim is to manage that exposure by taking action to keep exposure to an acceptable level in a cost-effective way.

Question 4

Risk Tolerance/Appetite:

Answer 4

The amount of risk a project is prepared to tolerate

Question 5

Risk Management Plan:

Answer 5

Documents the procedures for managing risks throughout the project

Question 6

Main topics in a Risk Management Plan:

Answer 6

1) Methodology
2) Roles and Responsibilities
3) Budget and Schedule
4) Risk Categories
5) Risk Probability and Impact
6) Risk Tolerances
7) Risk Tracking and Documentation

Question 7

Risk Identification:

Answer 7

• Identify threats or opportunities
• Can be done via brainstorming, interviewing, workshops or individually
• Involved multiple participants, e.g. PM, Project Sponsor, SC, Project Team…
• Risks should be specific
• The primary output are relevant entries in a Risk Register

Question 8

Risk Categories:

Answer 8

1) Technology
2) People
3) Organizational
4) Tools
5) Requirements
6) Estimation

Question 9

Assess (Risk Analysis):

Answer 9

Measure and prioritise the risks for further action

Question 10

Treat (Planning):

Answer 10

Develop options and determine actions to reduce threats to project objectives

Question 11

Actions Type - Prevention:

Answer 11

Terminate the risk - by doing things differently and thus removing the risk, where it is feasible to do so. Countermeasures are put in place that either stop the threat or problem from occurring or prevent it from having any impact on the project or business

Question 12

Actions Type - Reduction:

Answer 12

Treat the risk - take action to control it some way where that actions either reduce the likelihood of the risk developing or limit the impact on the project to acceptable levels

Question 13

Actions Type - Transference:

Answer 13

This is a specialist form of risk reduction where the management of the risk is passed to a third party via, for instance, an insurance policy or penalty clause, such that the impact of the risk is no longer an issue for the health of the project. Not all risks can be transferred in this way

Question 14

Actions Type - Acceptance:

Answer 14

Tolerate the risk - perhaps because nothing can be done at a reasonable cost to mitigate it or the likelihood and impact of the risk occurring are at an acceptable level

Question 15

Actions Type - Contingency:

Answer 15

These are actions planned and organised to come into fore as and when the risk occurs

Question 16

Control (Monitoring):

Answer 16

Minimize disruption to the project by tracking identified risks, identifying and analysing new risks, monitoring trigger conditions.

Question 17

Responsibilities - Project Manager:

Answer 17

Responsible for the overall management of risk, including identifying risks themselves

Question 18

Responsibilities - Project Teams:

Answer 18

Proactively identify risks and timely alert the Project Manager. Actively participate in treatment actions

Question 19

Responsibilities - Project Steering Committee and/or Project Sponsor

Answer 19

Notify PM of any external risk exposure, then make decisions on recommended by the PM actions to risk