Risk Flashcards
What is the purpose of project risk management?
Increase the probability of positive risks and decrease the probability of negative risks to optimize the chances of project success.
What are the two levels of risk for a project?
High level (overview) Low level (detailed)
What is the term used to describe the effect of uncertainty on the project as a whole?
Overall project risk
What are the processes used in the project risk management process?
Perform qualitative risk analysis Perform quantitative risk analysis Identify risks Plan risk responses Plan risk management Implement risk responses Monitor risks
What are trends and emerging practices used in project risk management?
Non-event risks
Project resilience
Integrated risk management
What are event based risks?
Uncertain future risks
What are the two types of non-even risks?
Variability risk
Ambiguity risk
What is a variability risk?
Uncertainty exists around key characteristics of a plan
What is Monte Carlo analysis?
For addressing variability risks, where a model is created to simulate conditions. The range of variation is illustrated in probability distributions. Actions are suggested to reduce the spread of possible outcomes.
What is an ambiguity risk?
Uncertainty exists around what might happen in the future (inherent systematic complexity)
How can an ambiguity risk be addressed?
From expert judgement and benchmarking against similar projects
What are emergent risks?
Unknowable unknowns - can only be recognized after they’ve occurred. Example: mad cow disease, global warming
How are emergent risks addressed?
Strong project resilience with back up plans and strategies
What is integrated risk management?
Involves managing organizational risks from a strategic perspective.
What are tailoring considerations for project risk management?
Project size
Project complexity
Project’s importance
Development approach
What are questions to ask when tailoring for project risk management?
“Does the project’s size require a more detailed approach to risk management?”
“Is a robust risk approach demanded by high levels of innovation, new tech, commercial arrangements, interfaces or external dependencies that increase project complexity?”
“How strategically important is the project”
“Is this a waterfall project, where risk processes can be followed sequentially and iteratively, or an agile project which requires risk to be addressed at the start of each iteration as well as during its execution?”
What are tailoring considerations for project risk management in an agile environment?
Risk responses are implemented in a more integrated fashion
Risks are referred to as impediments
High variability environments incur more uncertainty
Frequent reviews
What is the purpose of plan risk management?
Ensures that the aspects of risk management match the level of risk exposure and the importance of the project
What are risk categories?
A means for grouping individual project risks
What is a risk breakdown structure?
A way to structure risk categories, hierarchical representation
What is a stakeholder risk appetite?
Recorded in the risk management plan, it informs the details the plan risk management process
What are probability and impact matrices?
Used to prioritize risks
What are reporting formats?
Defines how the outcomes of the project risk management process will be documented, analyzed and communicated. Describes the content and format of the risk register and the risk report
What is tracking?
Documents how risk activities will be recorded and how risk management processes will be audited.
What are inputs to the plan risk management process?
Organizational process assets Project documents Project management plan Enterprise environmental factors Project charter
What are outputs to the plan risk management process?
Risk management plan
What are tools and techniques used for plan risk management?
Expert judgement
Meetings
Data analysis
What is the purpose of the identify risks process?
Identifies project risks and their characteristics
Documents individual project risks
What is SWOT analysis?
Examines the project from each of the strengths, weaknesses, opportunities and threats.
What are the inputs to the identify risks process?
Enterprise environmental factors Project management plan Organizational process assets Project documents Procurement documentation Agreements
What are the outputs to the identify risks process?
Risk report
Risk register
Project documents updates
What tools and techniques are used to identify risks?
Expert judgement Meetings Prompt lists Interpersonal and team skills Data gathering Data analysis
What is a prompt list?
Can be used as a framework to aid the project team in idea generation when using risk identification techniques
How are risk checklists developed?
Based on historical information and knowledge that has been accumulated from similar projects
What is the purpose of the perform qualitative risk analysis process?
Prioritizes individual risks so they can be analyzed for probability of occurrence and their impact. Focuses efforts on high priority risks. Risk perception introduces bias into the assessment, so attention should be paid to correct any biases.
What does the risk owner do?
A risk owner is assigned to each risk. They take responsibility for planning a risk analysis and ensuring that it is implemented.
What are the inputs to the perform qualitative risk analysis process?
Project management plan
Project documents
Enterprise environmental factors
Organizational process assets
What are the outputs to the perform qualitative risk analysis process?
Project documents updates
What are tools and techniques used for performing qualitative risk analysis?
Meetings Data representation techniques Expert judgement Interpersonal and team skills Risk categorization Data analysis Data gathering
What is the purpose of quantitative risk analysis?
It quantifies overall project risk exposure in terms of time, cost, resources, and can provide additional quantitative information to support response planning.
Why isn’t quantitative risk analysis used for every project?
It requires special risk software and expertise in the development and interpretation of risk models.
What are simulations?
Used to model the combined effects of individual project risks to evaluate their potential impact on achieving project objectives.
What is the S-curve?
Cumulative probability distribution - shows the probability of achieving any particular outcome.
What is sensitivity analysis?
Helps determine which individual project risks could have the most impact on project outcomes
What is a tornado diagram?
Used in sensitivity analysis. Presents the calculated correlation coefficient for each element of the quantitative risk analysis model that can influence the project outcome. Items are ordered by descending strength of correlation, giving the typical tornado appearance.
What is decision tree analysis?
A diagramming and calculation technique for evaluating the implications of a chain of multiple options in the presence of uncertainty.
How are decision trees used?
To support selection of the best of several alternative courses of action.
How is the decision tree evaluated?
By calculating the expected monetary value of each branch, allowing the optimal path to be selected.
What is an influence diagram?
Represents a project or situation as a set of entities, outcomes, and influences with their relationships and effects
What is a risk report?
A project document that will be updated to reflect the results of the quantitative risk analysis
How is the assessment of overall project risk measured?
By chances of project success and degree of variability remaining in the project.
What are the inputs to the perform quantitative risk analysis process?
Project management plan
Organizational process assets
Enterprise environmental factors
Project documents
What are the outputs to the perform quantitative risk analysis process?
Project documents updates
What are tools and techniques used for performing quantitative risk analysis?
Representations of uncertainty Expert judgement Data analysis Data gathering Interpersonal and team skills
What is the purpose of the plan risk responses process?
Identifies ways to address overall and individual project risks, allocates resources, inserts activities into project documents and project management plan as needed
What are the strategies for threats?
Escalate Avoid Transfer Mitigate Accept
What are the strategies for opportunities?
Escalate Exploit Share Enhance Accept
What are the strategies for overall project risk?
Avoid Exploit Transfer/share Mitigate/enhance Accept
What are contingent response strategies?
A plan that will only be executed under certain predefined conditions, if it is believed that there will be sufficient warning to implement the plan
What are the inputs to the plan risk responses process?
Project documents
Enterprise environmental factors
Project management plan
Organizational process assets
What are the outputs to the plan risk responses process?
Project management plan updates
Project documents updates
Change requests
What are tools and techniques used for the plan risk responses process?
Strategies for overall project risk, threats, opportunities, and contingent responses Decision making Expert judgement Interpersonal and team skills Data analysis and gathering
What is the purpose of the implement risk responses process?
Ensures the agreed-upon risk responses are executed as planned in order to address overall project risk exposure, minimize individual project threats, and maximize individual project opportunities
What are the inputs to the implement risk responses process?
Organizational process assests
Project management plan
Project documents
What are the outputs to the implement risk responses process?
Project documents updates
Change requests
What are some tools and techniques used for the implement risk responses process?
Expert judgement
Interpersonal and team skills
Project management information system
What is the purpose of the monitor risks process?
It allows for monitoring risk response plans, tracking identified risks, identifying and analyzing new risks, and evaluating risk process effectiveness
What are the inputs to the monitor risks process?
Project management plan
Project documents
Work performance data
Work performance reports
What are the outputs to the monitor risks process?
Project management plan updates Change requests Work performance information Project documents updates Organizational process assets updates
What are some tools and techniques used for the monitor risks process?
Audits
Data analysis
Meetings
