Deck 7: Managing Project Risk

Question 1

The best time to plan for risk is during the project execution phase when risk can be assessed most accurately.

Answer 1

False

Question 2

Learning cycles can be used as a tool for identifying threats and opportunities.

Answer 2

True

Question 3

Project risk management focuses solely on the downside of risk that results from unexpected problems or threats.

Answer 3

False

Question 4

Unknown-unknown risks are residual risks that we cannot even imagine happening.

Question 5

It never pays to ignore an element of project risk.

Question 6

Triggers or flags in the form of metrics should be identified to draw attention to a particular risk when it occurs.

Question 7

Effective project risk management requires that each risk have an owner.

Question 8

Since IT projects are developed in an environment that changes so rapidly and so extensively, there is little value in using past projects to guide our risk assessment of new ones.

Question 9

The concept of expected value rests on the notion of a probability-weighted summation of component parts.

Question 10

Failure to follow a formal risk management plan will often cause organizations to be reactive and find themselves in a state of perpetual crisis, a condition known as crisis management.

Question 11

Sensitivity analysis is used to determine the joint effects of multiple risky tasks, while Monte Carlo Simulation is used to measure which individual tasks pose the greatest project risk.

Question 12

The PMBOK definition of project risk suggests that a systematic process is needed to effectively manage the risk of a project.

Question 13

The deployment of a specific risk management strategy is in part a function of risk tolerance levels of the stakeholders.

Question 14

The area under the normal distribution curve that lies within 2 standard deviations of the mean (plus or minus) includes about 68% of all the values.

Question 15

The goal of a sound risk management is to completely avoid all risk.

Question 16

Since risk arises from uncertainty, there can be no such category as known risks.

Question 17

In general, because of the similarities in IT projects, one can manage all projects and risks in the same manner.

Question 18

The fishbone or Ishikawa diagram is a form of cause and effect analysis diagramming.

Question 19

Qualitative risk analysis has as one of its strengths the ability to include subjective analysis based on experience and judgment.

Question 20

Nominal Group Technique is a free form, unstructured process similar to Brainstorming.

Question 21

The Payoff Table would be used with which risk assessment technique ?

A) Qualitative Risk Analysis
B) Quantitative Risk Analysis
C) Cause-and- Effect Diagram
D) Simulations
E) Probability Distributions

Question 22

Gaining consensus from a group of experts would be most closely associated with:

A) Learning Cycles
B) Brainstorming
C) Nominal Group Technique
D) Delphi Technique
E) Cause-and-Effect Diagrams

Question 23

_____ is the core layer in the IT Project Risk Identification Framework.

A) Measurable Organizational Value
B) Project objectives
C) Risk sources
D) Internality / Externality
E) Known / Unknown

Question 24

_____requires determining the true problem, or cause, of the risk.

A) risk identification
B) risk assessment
C) risk planning
D) risk monitoring and control
E) risk evaluation

Question 25

Which of the following distributions has mean which is equal to (a + 4b +c) / 6 where a, b, and c are denote optimistic, most likely, and pessimistic estimates respectively?:

A) Discrete Distribution
B) Normal Distribution
C) Pert Distribution
D) Triangular Distribution
E) Binomial Distribution

Question 26

_____ is an uncertain event that, if it occurs, has a positive or negative effect on project objectives.

A) Risk management
B) Risk response
C) Project risk
D) Risk plan
E) Risk control

Question 27

_____ involves developing a probability distribution for understanding and responding to identified risks.

A) Plan Risk Management
B) Identify Risks
C) Perform Quantitative Risk Analysis
D) Plan Risk Responses
E) Monitor and Control Risks

Question 28

A _____ is a structured tool that identifies risks that have occurred in the past.

A) learning cycle
B) brainstorming session
C) Nominal Group Technique
D) Delphi Technique
E) checklist

Question 29

_____ are the processes of conducting risk management planning, identification, analysis, response planning, and monitoring and control on a project.

A) Project risk management
B) Project risk response
C) Project risk planning
D) Project risk analysis
E) Project risk control

Question 30

Successful risk management requires _____

A) misunderstanding the benefits of risk management
B) inadequate time for risk identification
C) use of a non-standard approach to assess risk
D) stakeholder responsibility
E) occasional monitoring of risks to ensure compliance

Question 31

_____ focuses on root-cause analysis and determining the cause of risks, as well as the effects of risks on the project.

A) Learning Cycles
B) Brainstorming
C) Nominal Group Technique
D) Delphi Technique
E) Cause-and-Effect Diagrams

Question 32

_____ use only integer or whole numbers, where fractional values are not allowed or would not make sense.

A) Discrete Distribution
B) Normal Distribution
C) Pert Distribution
D) Triangular Distribution
E) Binomial Distribution

Question 33

Initial generation of ideas without evaluation would be most closely associated with:

A) Learning Cycles
B) Brainstorming
C) Nominal Group Technique
D) Delphi Technique
E) Cause-and-Effect Diagrams

Question 34

Receiving a much larger than usual gas utility bill because of an early spring cold spell is an example of what type of risk?

A) known risk
B) known-unknown risk
C) unknown-unknown risk
D) known-known
E) none of these

Question 35

A _____ identifies threats and opportunities in the external environment as well as organizational strengths and weaknesses .

A) Learning Cycle
B) SWOT Analysis
C) Nominal Group Technique
D) Delphi Technique
E) Checklist

Question 36

Identifying what you know, what you think you know, and things you need to find out would be activities most closely associated with:

A) Learning Cycles
B) Brainstorming
C) Nominal Group Technique
D) Delphi Technique
E) Cause-and-Effect Diagrams

Question 37

_____ prioritizes risks so that an effective risk strategy can be formulated.

A) Risk mitigation
B) Risk assessment
C) Risk avoidance
D) Risk analysis
E) Risk monitoring and control

Question 38

A structured technique for identifying risks which requires participants to rank and prioritize ideas in round-robin fashion is most closely associated with:

A) Learning Cycles
B) Brainstorming
C) Nominal Group Technique
D) Delphi Technique
E) Cause-and-Effect Diagrams

Question 39

The first step in managing IT project risk is _____.

A) risk identification
B) risk assessment
C) risk planning
D) risk monitoring and control
E) risk evaluation

Question 40

_____ involves deciding which risks can impact the project.

A) Plan Risk Management
B) Identify Risks
C) Perform Quantitative Risk Analysis
D) Plan Risk Responses
E) Monitor and Control Risks

Question 41

Risks may be positive or negative. For a positive risk, a project manager would want to _____.

A) accept the risk
B) share ownership
C) avoid the risk
D) reduce the impact of the risk
E) transfer the risk

Question 42

What is project risk management?

Question 43

Through _____, the project manager will scan the project environment to watch for risks as they may arise.

A) risk identification
B) risk assessment
C) risk planning
D) risk monitoring and control
E) risk strategies

Question 44

Why can identifying IT project risks be difficult?

Question 45

What is SWOT analysis? How can this technique be used to identify IT project risks?

Question 46

What is project risk?

Question 47

What is the Delphi Technique? How can this technique be used to identify IT project risks?

Question 48

In a normal distribution we would expect to find _______ of all values with in + or - 2 standard deviation.

A) 13%
B) 34%
C) 68%
D) 95%
E) 99%

Question 49

Once a risk is made known, _____ will execute the planned risk strategy.

A) risk identification
B) risk assessment
C) risk planning
D) risk response
E) risk strategies

Question 50

_____ determines each identified risk's probability of occurrence and impact on the project.

A) Risk mitigation
B) Risk assessment
C) Risk avoidance
D) Risk analysis
E) Risk monitoring and control

Question 51

_____ lead to lessons learned to determine how the risk was handled.

A) risk identification
B) risk assessment
C) risk planning
D) risk response
E) risk evaluation

Question 52

In a normal distribution we would expect to find _______ of all values with in + or - 1 standard deviation.

A) 13%
B) 34%
C) 68%
D) 95%
E) 99%

Question 53

_____involves determining the likelihood and project impact of a risk.

A) risk identification
B) risk assessment
C) risk planning
D) risk monitoring and control
E) risk evaluation

Question 54

_____determines how to deal with the occurrence of a risk.

A) risk identification
B) risk assessment
C) risk planning
D) risk monitoring and control
E) risk strategies

Question 55

_____ randomly generates specific values for a variable with a specific probability distribution.

A) Discrete Distribution
B) Normal Distribution
C) Pert Distribution
D) Monte Carlo Simulation
E) Binomial Distribution

Question 56

Which of the following distributions has mean which is equal to (a +b +c) / 3 where a, b, and c are denote optimistic, most likely, and pessimistic estimates respectively?:

A) Discrete Distribution
B) Normal Distribution
C) Pert Distribution
D) Triangular Distribution
E) Binomial Distribution

Question 57

What is meant by crisis management? And why do many organizations find themselves in this mode?

Question 58

Reserves and contingency plans would be used in which risk strategy ?

A) accept or ignore
B) avoidance
C) mitigation
D) transfer
E) none of these

Question 59

Describe how learning cycles can be used to identify IT project risks.

Question 60

What are the six project risk management processes?

Question 61

What is a risk response plan? What should be included?

Question 62

The text discusses three common mistakes found in managing project risk.Choose two of them and after stating them, discuss the implications of making that mistake.

Question 63

Compare the three types of project risk: known, known-unknown, and unknown-unknown.Give an example of each.

Question 64

Briefly describe the six IT Project Risk Management processes.

Question 65

What are the strengths and weaknesses of using the Delphi Technique for identifying threats and opportunities?

Question 66

The text discusses seven main risk response strategies.Briefly describe them and the implications of choosing one over another.

Question 67

What is risk monitoring and control?

Question 68

What is the purpose of a risk impact table?

Question 69

Define and discuss the seven risk strategies described in this chapter.

Question 70

Describe some of the tools that are typically employed to monitor and control risk.

Question 71

What factors determine the appropriate risk strategy to deploy?

Question 72

What should be required of project stakeholders with regard to managing project risk successfully?

Question 73

What is a Monte Carlo simulation? Describe a situation (other than the one used in this chapter) that could make good use of a Monte Carlo simulation.

Question 74

What is a contingency plan?

Question 75

What is a fishbone (Ishikawa) diagram? How can this tool be used to identify IT project risks?

Question 76

How is a Monte Carlo simulation conducted?

Question 77

What are the potential advantages that qualitative approaches have over quantitative ones when it comes to risk analysis and assessment?