Intro to Project Management

List the steps of risk management in their proper sequence.

1. Risk Identification 2. Risk Assessment 3. Risk Response Development 4. Risk Response Control

Place the following components of the risk response matrix in the correct sequence.

1. Risk even 2. Response 3. Contingency plan 4. Trigger 5. Who is responsible

What best describes a contingency fund for a project?

A reserve to manage all known and unknown project risks.

Where are time buffers typically applied in a project plan?

Activities with severe risk. Activities requiring scarce resources. Activities that merged when they are prone to delays.

Which of the following types of activities might need time buffers?

Activities with severe risks. Noncritical activities to reduce the likelihood that they will create another critical path. Activities that require scarce resources. Merge activities

What time frames does the statistical methodology in Program Evaluation and Review Technique (PERT) simulation utilize?

Activity optimistic and pessimistic times

When identifying risk, a team should initially focus on what aspect of risk?

Actual events that increase the risk

Which statement best defines the methodology for sharing project opportunities?

Allocate some or all ownership to another party best able to capture the opportunity for the benefit of the project.

Identify the responses to a risk event when the risk has been identified and assessed.

Avoid Mitigate Transfer Retain

___________________ risk is changing the project plan to eliminate the risk or condition.

Avoiding

What type of contingency is typically required to manage a "schedule risk", i.e., finishing a project late?

Budget reserves, i.e. cash

Which statements are correct with respect to time buffers?

Buffers should be added to projects with high uncertainties.

What are the potential actions of project funding cuts such as the reduction or elimination of the source of project cash inflow?

Cancel remainder of the project. Reduce project scope.

Which best describes what is meant by "risk avoidance" in a risk management plan?

Changing the project plan to eliminate a risk condition.

______________ reserves are identified for specific work packages or segments of a project found in the baseline budget or work breakdown structure.

Contingency

________________ reserves are set up to cover identified risks; these reserves are allocated to specific segments or deliverables of the project.

Contingency

_________________ reserves are identified for specific work packages or segments of a project found in the baseline budget or work breakdown structure.

Contingency

What two statements are correct and explain the distinction between a risk response plan and a contingency plan?

Contingency plans go into effect after a risk occurrence happens. Risk response plans are initiated before the risk occurs.

Change management systems utilize what process steps?

Controlling Recording Reporting

______________ is reducing the time it takes to complete a project.

Crashing or Crunching

What are key components of a contingency plan?

Defining the event that will initiate/trigger the plan into action. Naming a person responsible to execute the plan. Cost estimates in the planning, not execution, phase.

What is required in order for risk response control to succeed?

Documentation of responsibility

Which statement best defines the methodology for exploiting project opportunities?

Eliminate the uncertainty associated with an opportunity to ensure that it definitely happens.

______________ risk occurs when the project encounters a threat that is outside the scope of the project or the authority of the project manager.

Escalating

Risk Assessment is the first step in the risk management process.

False

True or false: A risk breakdown structure should focus on task-level risks during the initial risk identification stage.

False

What is key to developing a risk transfer approach to risk management?

Identify and document responsibility for absorbing the impact of the risk occurrence.

________________ scales can be a bit more problematic, since adverse risks affect project objectives differently.

Impact

Which of the following are used by a risk assessment matrix to prioritize identified risk?

Impact Likelihood

In scenario analysis, which of the following is used to assess risk?

Impact of an event Probability of an event

Which are potential impacts given a project with risk responses but no contingency plan?

Incorrect actions taken. Delayed corrective action. Panic

Which methods may be used to transfer risk in a project?

Insurance Warranties and/or guarantees Fixed price contracts

What are the drawbacks in using insurance to transfer risk?

It may be difficult to explain the risk and its consequences to an insurance broker. Insurance is often costly.

Which are appropriate methods for handling cost risk?

Item-by-item price risk analysis

What characteristics of a risk event may make "accepting the risk" an appropriate strategy?

Low cost impact. Extremely low probability of occurrence.

______________ reserve funds are needed to cover major unforeseen risks and, hence, are applied to the total project.

Management

Which statements about management reserves are correct?

Management reserves are established after the budget reserves are identified.

What is the benefit of a risk management plan for a project?

Minimizing the impact of risks occurring.

When the project encounters a threat that is outside the scope of the project or the authority of the project manager, what should they do?

Notify the appropriate people within the organization

When assigning responsibility for responding to risk on a work package, which stakeholders should be involved in the decision-making?

Project manager Person responsible for work package Person responsible for risk response

Risk profiles are generated and maintained usually by who?

Project office

Which aspects of project management require a system/process to track and control change?

Project scope. Improvements suggested by team members. Implementation of contingency plans

Assessing identified risk is done with respect to what aspect of the project? (Check all that apply.)

Project timing Project cost Project priorities

Which mitigation strategy is normally first pursued to minimize the cost impact of a risk event occurring?

Reduce likelihood.

________________ risk occurs when a conscious decision is made to accept the risk of an event occurring.

Retaining

What term is used to describe the documents needed to develop an adequate risk response control plan?

Risk Register.

The sequence of steps in managing opportunities is the same as negative risk, but which step utilizes a different approach?

Risk Response Development.

Match the type of contingency with the correct definition. Management -------> Time ----------------->

Set up to cover unknown/unidentified risks. Set up to cover identified and/or unknown risks.

In addition to the core project team, who should/may participate in identifying risk?

Sponsors Customers Outside vendors/contractors

Over the life of a project, how does the chance of risk events behave?

Starts high and declines, ending low

Over the life of a project, how does the cost to fix risk events behave?

Starts low and rises, ending high

_________________ risks are problematic; they can often be the kind that cause the project to be shut down.

Technical

Which are appropriate methods for handling technical (project technology related issues) risk?

Testing and assessment methods. Back-up or alternate plans.

What aspects of project change control are documented within a communication plan at the start of a project?

The evaluation/decision making process. How stakeholders will be notified of changes.

What is the outcome of the statistical methodology used in the Program Evaluation and Review Technique (PERT)?

The likelihood of various project durations

Which statement best defines the methodology for enhancing project opportunities?

The opposite of mitigation, i.e. take actions to increase the probability and/or impact of a positive occurrence.

Too large to be transferred. -----> Costs are too small to mitigate. --> So unlikely it is ignored. ---->

The project owner assumes the risk of an event occurring. The budget reserve absorbs the risks if they materialize. A cost overrun is accepted should the risk event occur.

Which statement best describes the scales used to measure/predict probability, impact, and detection?

They may vary depending on the project.

Why is the second step of risk management to assess the risks identified in the first step?

To establish priorities for attention

What is the purpose of a contingency fund in executing a response to an opportunity (positive risk) occurring?

To take advantage of opportunities

Which statement is correct with respect to transferring risk?

Transfer of risk does not change the likelihood or impact.

What is a risk event?

What can go wrong during the project

Which statement best defines the methodology for accepting project opportunities?

When the event occurs, implement increased application of resources, but don't expend any pursuing it.

Which source(s) of project information must be reviewed and, if necessary, updated/changed upon approval of a change request proposal?

Work Breakdown Structure Project baseline

The goal of the failure mode and effects analysis (FMEA) is to prioritize risk by _____.

assigning numerical FMEA rankings

One of the keys to success in risk identification is__________________.

attitude or outlook

Freeway projects can fall short of the original intentions but still add value for each mile completed. This is called being "__________________".

chunkability

___________________ funds are established to cover project risks.

contingency

Contingency reserves__________ as the project progresses.

decrease

In scenario analysis, the significance of ____ is assessed.

each risk event

In the face of overall schedule uncertainty, buffers are sometimes added to the__________ of the project.

end

Only by focusing on actual___________ can potential solutions be found.

events

A giant Popsicle melting faster than expected is an example of_________ risk.

negative

Projects of long duration need some contingency for________ changes—which are usually upward.

price

As a risk mitigation strategy, It is common to use_____________ a between old and new projects to adjust time or cost.

ratio

The risk management process begins by trying to generate a list of all the possible _______________ that could affect the project.

risk

Risk responses are developed based upon ___.

risk assessment classifications.

A ____ is a list of questions that address traditional areas of uncertainty on a project, drawn from previous, similar projects.

risk profile

A_____________ _____________ details all identified risks, including descriptions, category, probability of occurring, impact, responses, contingency plans, owners, and current status.

risk register

Impact × Probability × Detection =__________________ __________________________

risk value

Contingency and management reserves should be kept ______________

separate

The risk breakdown structure is used in conjunction with the ___ to help identify risks.

work breakdown structure