ITPM Chapter 11

_____ involves monitoring identified and residual risks, identifying new risks, carrying out risk response plans, and evaluating the effectiveness of risk strategies throughout the life of the project.

controlling risk

System or process _____ are diagrams that show how different parts of a system interrelate.

flowcharts

The _____ lists the relative probability of a risk occurring and the relative impact of the risk occurring.

probability/matrix impact

_____ are numbers that represent the overall risk of specific events, based on their probability of occurring and the consequences to the project if they do occur.

risk factors

A(n) _____ documents the procedures for managing risk throughout the project.

risk management plan

_____ involves allocating ownership of the risk to another party.

risk sharing

What is the first step in a Monte Carlo analysis?

Assess the range for the variables being considered.

_____ involves numerically estimating the effects of risks on project objectives.

performing quantitative risk analysis

A _____ person achieves a balance between risk and payoff.

risk neutral

_____ are unplanned responses to risk events used when project teams do not have contingency plans in place.

workarounds

List the four methods for identifying risks.

Brainstorming, Delphi technique, Interviewing, Root cause analysis, SWOT analysis

_____ are provisions held by the project sponsor or organization to reduce the risk of cost or schedule overruns to an acceptable level.

Contingency reserves

The basic concept of the _____ technique is to derive a consensus among a panel of experts who make predictions about future developments.

Delphi

_____ is the product of a risk event probability and the risk event's monetary value.

EMV

T/F: A probability/impact matrix or chart lists the relative probability of a risk occurring on one side of a matrix or axis on a chart and the relative impact of the risk occurring on the other.

False

T/F: Brainstorming is a systematic, interactive forecasting procedure based on independent and anonymous input regarding future events.

False

T/F: Risk events refer to specific, certain events that may occur to the detriment or enhancement of the project.

False

T/F: The last step in project risk management is deciding how to address this knowledge area for a particular project by performing risk management planning.

False

T/F: The lower the earned monetary value calculation for a project, the chances of project success is higher.

False

T/F: Unknown risks can be managed proactively.

False

_____ analysis simulates a model's outcome many times to provide a statistical distribution of the calculated results.

Monte Carlo

List and briefly describe the six major processes involved in risk management.

Planning risk management, Identifying risks, Performing qualitative risk analysis, Performing quantitative risk analysis, Planning risk responses, Controlling risk

What are the four basic response strategies for negative risks?

Risk avoidance, Risk acceptance, Risk transference, Risk mitigation

_____ are/is a qualitative risk analysis tool that maintains an awareness of risks throughout the life of a project in addition to identifying risks.

Top Ten Item Risk Tracking

T/F: A risk-seeking person prefers outcomes that are more uncertain and is often willing to pay a penalty to take risks.

True

T/F: Contingency plans are predefined actions that the project team will take if an identified risk event occurs.

True

T/F: Identified risks may not materialize, or their probabilities of occurrence or loss may diminish.

True

T/F: One possible response to managing negative risk it to accept the potential effects from the risk.

True

_____ is a technique by which a group attempts to generate ideas or find a solution for a specific problem by amassing ideas spontaneously and without judgment.

brainstorming

_____ is the process of understanding what potential events might hurt or enhance a particular project.

contingency reserves

A(n) _____ is a diagramming analysis technique used to help select the best course of action in situations in which future outcomes are uncertain.

decision tree

_____ involves determining which risks are likely to affect a project and documenting the characteristics of each.

identifying risks

A(n) _____ represents decision problems by displaying essential elements, including decisions, uncertainties, causality, and objectives, and how they influence each other.

influence diagram

_____ is a fact-finding technique that can be used for collecting information in face-to-face, phone, e-mail, or instant-messaging discussions.

interviewing

The term _____ is used to describe risks that the project team has identified and analyzed.

known risks

Potential problems that might occur on the project and how they might impede project success are _____ risks.

negative

_____ involves prioritizing risks based on their probability and impact of occurrence.

performing qualitative risk analysis

Identifying risks is a subprocess of the _____ process of project risk management.

planning

Performing qualitative and quantitative risk analyses are subprocesses of the _____ process of project risk management.

planning

_____ involves deciding how to approach and plan the risk management activities for the project.

planning risk management

_____ applies to positive risks when the project team cannot or chooses not to take any actions toward a risk.

risk acceptance

The degree of uncertainty an entity is willing to take on in anticipation of a reward is

risk appetite

_____ involves eliminating a specific threat, usually by eliminating its causes.

risk avoidance

_____ involves doing whatever you can to make sure the positive risk happens.

risk exploitation

_____ involves reducing the impact of a risk event by reducing the probability of its occurrence.

risk mitigation

The _____ is the person who will own or take responsibility for the risk.

risk owner

A(n) _____ is a document that contains results of various risk management processes.

risk register

The main output of qualitative risk analysis is updating the ________.

risk register

_____ involves shifting the consequence of a risk and responsibility for its management to a third party.

risk transference

_____ is the amount of satisfaction or pleasure received from a potential payoff.

risk utility

Risk utility rises at a decreasing rate for a _____ person.

risk-averse

Those who are _____ have a higher tolerance for risk, and their satisfaction increases when more payoff is at stake.

risk-seeking

_____ risks refer to those that are direct results of implementing risk responses.

secondary

Expected monetary value (EMV)

the product of a risk event probability and the risk event's monetary value.

T/F: Top Ten Risk Item Tracking is a quantitative risk analysis tool.

False

decision tree

a diagramming analysis technique used to help select the best course of action in situations in which future outcomes are uncertain. A common application of decision tree analysis involves calculating expected monetary value.

The main output of the _____ process is the start of a risk register.

identifying risks

Risk utility rises at a decreasing rate for a(n) _____ person.

risk-averse

A(n) _____ is a hierarchy of potential risk categories for a project.

risk-breakdown structure

_____ are indicators or symptoms of actual risk events.

triggers

A(n) _____ is a list of risks that are low priority, but are still identified as potential risks.

watch list

T/F: The risk register can be created with a simple Microsoft Word or Excel file.

True

A _____ is a technique used to show the effects of changing one or more variables on an outcome.

sensitivity analysis

T/F: The Monte Carlo analysis can predict the probability of finishing by a certain date or the probability that the cost will be equal to or less than a certain value.

True

Unenforceable conditions or contract clauses and adversarial relations are risk conditions associated with the project _____ management knowledge area.

procurement

A project _____ is an uncertainty that can have a negative or positive effect on meeting project objectives.

risk

_____ involves changing the size of the opportunity by identifying and maximizing key drivers of the positive risk.

risk enhancement

T/F: The Microsoft Solution Framework (MSF) includes a risk management model that includes developing and monitoring a top-ten master list of risks.

True

_____ involves taking steps to enhance opportunities and reduce threats to meeting project objectives.

planning risk responses

T/F: The psychology literature shows that individuals, working alone, produce fewer ideas than the same individuals produce through brainstorming in small, face-to-face groups.

False

T/F: Quantitative risk analysis need not be done for projects that are large and complex.

True

T/F: Risks can have both negative and positive effects on meeting project objectives.

True

T/F: The Delphi technique is a systematic, interactive forecasting procedure based on independent and anonymous input regarding future events.

True