Deck 8: Project Risk Management Planning

Question 1

The key deliverable from the risk identification process is the risk register.

Answer 1

True

Question 2

List and describe the elements of the risk register.

Answer 2

The risk register is the main deliverable from the risk identification and analysis process. The risk register is a dynamic document that must be continually updated as a project progresses. The risk register consists of the following elements:
• Risk-This is the name of the risk, along with a short description. Some like to include a numbering scheme to make it easier to reference.
• Trigger event-This is an explanation of the event or events that signal to the person monitoring that this risk is about to happen or has happened; it involves looking at the root cause of the risk. For example, if a vendor hired to create a sizable portion of the code needed for the new application has been experiencing larger-than-normal turnover rates among employees, trigger event will be any missed or late milestones or software quality issues.
• Responsible-This is the name of the person (preferred) or group/department responsible for monitoring the risk and executing mitigation activities. Using the previous example, a software development project leader may be assigned responsibility for tracking a vendor's progress.
• Consequence-This is an explanation of the impact to the project if the risk occurs. For example, if a vendor is late with its part of a system, the entire project schedule will be delayed, also raising the project budget.
• Probability-This is an estimation of the likelihood that the risk will materialize and affect the project. The probability is often a qualitative rating (low, medium, high) or could be a more quantitative number.
• Mitigation-This is an explanation of the strategy being used to reduce the chances that the risk will occur. For example, say that the team decided to set up multiple two-week milestones for the vendor to keep an eye on the vendor's progress and make sure it doesn't start slipping.

Question 3

What are the main objectives of risk management, and what is the opposite of good risk management?

Answer 3

The main objectives of risk management are to increase the probability and impact of positive outcomes and decrease the probability and impact of negative outcomes. Unfortunately, many organizations don't follow a formal risk management process; rather, they operate in a perpetual state of crisis management. Crisis management, the opposite of good risk management, involves trying to figure out what to do about a problem after it has occurred instead of planning for issues in advance. This is also referred to as perpetual fire fighting.

Question 4

What is qualitative risk analysis, and describe two techniques?

Question 5

List and describe an organization's three possible risk preferences.

Question 6

Name and describe the four categories of risk strategy.

Question 7

The PMBOK defines risk management as "the systematic process of identifying, analyzing, and responding to project risk."

Question 8

The key to running a successful brainstorming session is to foster an atmosphere that allows all ideas to be spoken, regardless of likelihood.

Question 9

Risk management provides maximum-cost downside protection.

Question 10

Describe at least five reasons to perform risk management.

Question 11

The risk management plan is created late in the planning phase of the project and updated throughout the life of the project.

Question 12

A project manager's objective is to remove all risk from a project.

Question 13

The primary deliverable from the risk management planning process is the risk management plan.

Question 14

Describe the steps in the risk management planning process.

Question 15

Executing the process to build the risk management plan is only necessary for large projects.

Question 16

What are the risk management processes described by PMBOK?

Question 17

Describe two quantitative risk analysis techniques.

Question 18

What information composes the risk management plan?

Question 19

The main objectives of risk management are to increase the probability and impact of positive outcomes and decrease the probability and impact of negative outcomes.

Question 20

Risk management makes aggressive risk-taking possible.

Question 21

Risk management cannot save part of a failed effort.

Question 22

Organizations that are risk neutral grow in utility at a faster pace than risk and the increase in expected outcomes.

Question 23

The more risks a team identifies and quantifies, the more the team reduces the amount of uncertainty on the project and gives the project manager the information necessary to build in sufficient contingency reserves to help ensure that a product is delivered as defined.

Question 24

Monte Carlo simulation is a technique in quantitative risk analysis.

Question 25

According to the PMBOK, risk response planning is the process of developing options and determining actions to enhance opportunities and reduce threats to a project's objectives.

Question 26

The acronym EMV stands for expected monetary value.

Question 27

After the initial risk identification, the project manager alone should look for new issues that may affect the success of the project.

Question 28

Fallback plans are used if the project cannot be completed as originally planned so an alternate destination needs to be sought.

Question 29

The success of the interviewing technique for risk identification is heavily dependent on the skills of the interviewee.

Question 30

The key issue with qualitative risk assessment is estimator experience.

Question 31

Risk identification tools and techniques include broad organizational categories, analogy, brainstorming, interviews, Delphi technique, and SWOT analysis.

Question 32

Consequence is an explanation of the event or events that signal to the person monitoring that this risk is about to happen or has happened; it involves looking at the root cause of the risk.

Question 33

Decision tree analysis is a technique in qualitative risk analysis.

Question 34

A probability and impact matrix aids a project team in prioritizing the risks that need more attention than others, based on either their probability of occurring or the size of the impact to the project or both.

Question 35

Monitor and control is a process of risk management.

Question 36

Quantitative risk analysis consists of subjective techniques used to determine the probability of occurrence and the project impact of identified risks.

Question 37

In analogy approach to risk identification, risks are examined using broad categories such as people, technology changes, quality and performance issues, customers, vendors, management, funding, political issues, legal issues, and market forces.

Question 38

Every risk should have an associated mitigation strategy.

Question 39

Contingency plans are used if the project cannot be completed as originally planned so an alternate destination needs to be sought.

Question 40

Risk identification is a one-time process done only at the beginning of a project.

Question 41

The key deliverable from the risk identification process is the ________.

A) risk document
B) risk matrix
C) risk plan
D) risk register

Question 42

A key benefit of this technique is the focus on both sides of each issue: strengths versus weaknesses and opportunities versus threats.

A) Brainstorming.
B) Delphi.
C) SWOT analysis.
D) Categorization.

Question 43

Risk management protects against invisible transfers of responsibility.

Question 44

This is an explanation of the strategy being used to reduce the chances that the risk will occur.

A) Mitigation.
B) Consequence.
C) Probability.
D) Elimination.

Question 45

There are risks that provide new opportunities that will affect a project in a constructive way, and there are risks that threaten the success of the project.

Question 46

The ________ technique is another technique that helps a project team brainstorm ideas anonymously.

A) brainstorming
B) Delphi
C) SWOT analysis
D) categorization

Question 47

The first step in the risk management planning process is to ________ as many risks as possible for the upcoming project, with the knowledge that you can never see them all.

A) analyze
B) identify
C) document
D) eliminate

Question 48

Which of the following is NOT a process of risk management, according to PMBOK?

A) Plan risk management.
B) Identify risks.
C) Identify resources.
D) Plan risk responses.

Question 49

A project manager's objective is not to remove all risk from a project-that simply can't be done-but to identify and manage risks to the benefit of the project.

Question 50

________ is a non-structured or semi-structured method of eliciting ideas from a group, with the goal of generating a complete list of ideas.

A) Brainstorming
B) Delphi
C) SWOT analysis.
D) Categorization

Question 51

Risk management sets up projects for success by providing a clear understanding of what is possible within normal operating procedures and what might be a stretch to achieve.

Question 52

The PMBOK defines risk management as "the systematic process of identifying, analyzing, and ________ project risk."

A) minimizing
B) communicating
C) documenting
D) responding to

Question 53

This is the primary deliverable from the risk management planning process .

A) Risk management plan.
B) Risk management document.
C) Risk management matrix.
D) Risk management charter.

Question 54

According to the dictionary, ________ is simply defined as the possibility of loss or injury.

A) risk
B) defect
C) probability
D) speculation

Question 55

The ________ approach to risk identification uses information from past similar projects or the experience of team members to look for risks.

A) SWOT
B) broad category
C) analogy
D) Delphi

Question 56

Which of the following is NOT a tool or technique for identifying risks?

A) Brainstorming.
B) Pareto technique.
C) Delphi technique.
D) SWOT analysis.

Question 57

In IT projects, risk can be defined as a function of the project ________ and the likelihood of an event occurring.

A) plan
B) impact
C) probability
D) schedule

Question 58

The size, complexity, length of schedule, or ________ importance of the project should dictate the time and energy spent on the risk management process.

A) elementary
B) portfolio
C) programmatic
D) strategic

Question 59

Risk management criminalizes risk by preventing an honest and open evaluation of risk to occur.

Question 60

This is an estimation of the likelihood that the risk will materialize and affect the project.

A) Mitigation
B) Consequence
C) Probability
D) Elimination

Question 61

Which of the following is a technique in performing qualitative risk analysis?

A) Artificial intelligence
B) Interviews
C) Probability and impact matrix
D) B and C

Question 62

________, the opposite of good risk management, involves trying to figure out what to do about a problem after it has occurred instead of planning for issues in advance.

A) Crisis management
B) Reaction
C) Procrastination
D) Denial

Question 63

________ entails eliminating a specific threat or risk, usually by eliminating its causes, making a change in the design, making a change in requirements, or changing technology to remove the risk entirely. It's important to recognize that avoiding the risk may also avoid associated benefits.

A) Risk avoidance
B) Risk acceptance
C) Risk transference
D) Risk mitigation

Question 64

According to the PMBOK, risk ________ planning is the process of developing options and determining actions to enhance opportunities and reduce threats to a project's objectives.

A) elimination
B) management
C) response
D) mitigation

Question 65

With ________, an organization can reduce the impact of a risk event by reducing the probability of its occurrence. Organizations are making heavy use of prototyping and newer agile product development methodologies that include short development phases with heavy customer involvement and continuous testing as a mitigation strategy to lessen the risks associated with systems development projects.

A) risk avoidance
B) risk acceptance
C) risk transference
D) risk mitigation

Question 66

In decision tree analysis with EMV, the sum of the ________ must equal 100 percent.

A) weights
B) probabilities
C) consequences
D) costs

Question 67

Risk management protects against invisible transfers of ________.

A) personal growth
B) time savings
C) responsibility
D) project managers

Question 68

This is an explanation of the event or events that signal to the person monitoring that this risk is about to happen or has happened; it involves looking at the root cause of the risk.

A) Mitigation
B) Consequence
C) Probability
D) Trigger event

Question 69

Crisis management is also referred to as ________.

A) general management
B) fire fighting
C) recovery
D) reactionary

Question 70

This is an explanation of the impact to the project if the risk occurs.

A) Mitigation
B) Consequence
C) Probability
D) Elimination

Question 71

There are risks that provide new ________ that will affect a project in a constructive way, and there are risks that threaten the success of the project.

A) strengths
B) weaknesses
C) opportunities
D) threats

Question 72

________ are excess amounts of time, money, resources, and so on that are approved for the project and are used only if necessary in order for the project to finish as originally planned.

A) Fallback plans
B) Contingency plans
C) Contingency reserves
D) Budget runovers

Question 73

With this risk strategy, an organization can decide to accept the consequences if a risk occurs without trying to control it. In this situation, no mitigation strategy is deemed necessary, although you may set aside some contingency reserves for cost and schedule.

A) Risk avoidance
B) Risk acceptance
C) Risk transference
D) Risk mitigation

Question 74

________ risk analysis consists of subjective techniques used to determine the probability of occurrence and the project impact of identified risks.

A) Qualitative
B) Quantitative
C) Consequential
D) SWOT

Question 75

Which of the following is not an industry best practice regarding risk management process?

A) Manage projects by managing their risks.
B) Create and maintain a census of risks for each project.
C) Assess each risk for probability and likely cost.
D) Identify the majority of risks from executive level stakeholders.

Question 76

Risk management maximizes opportunity for ________.

A) personal growth
B) time savings
C) responsibility
D) project managers

Question 77

A project manager's objective is not to remove all risk from a project but to identify and ________ risks to the benefit of the project.

A) mitigate
B) transfer
C) eliminate
D) manage

Question 78

With this risk strategy, an organization can shift the consequence of a risk and responsibility for its management to a third party that is internal or external to the organization (outsourcing), or it can move it to another department within the same company.

A) Risk avoidance
B) Risk acceptance
C) Risk transference
D) Risk mitigation

Question 79

________ analysis is based on mathematical or statistical techniques to model the behavior of a particular risk.

A) Qualitative
B) Quantitative
C) Consequential
D) SWOT

Question 80

Executing the process to build the risk management plan should be done on ________ projects.

A) only large
B) only high risk
C) only high cost
D) all