Project Management Chapter 7

One of the following five choices is NOT involved in risk control. Which choice is it? executing the risk response strategy initiating contingency plans establishing a change control system establishing contingency funds watching for new risks

establishing contingency funds Risk control involves executing the risk response strategy, monitoring triggering events, initiating contingency plans, and watching for new risks. Establishing a change management system to deal with events that require formal changes in the scope, budget, and/or schedule of the project is an essential element of risk control.

This response is used to remove any uncertainty associated with an identified opportunity. exploit share enhance accept escalate

exploit Definition of an exploit response to an identified Opportunity.

________ reserves are controlled by the project manager and the owner of the project and are used to cover major unforeseen risks to the entire project. management contingency budgetary unforeseen incidental

management These reserve funds are needed to cover major unforeseen risks and, hence, are applied to the total project. For example, a major scope change may appear necessary midway in the project.

Which of the following is NOT included in a Failure Mode and Effects Analysis? impact probability detection risk value all of these are included

all of these are included

After your team has successfully identified potential risks that could affect the project, what is the next step? create a risk breakdown structure assess identified risks create contingency plans decide how to respond to all risks mitigate risks

assess identified risks After risks have been identified, not all of them deserve attention. Managers have to develop methods for sifting through the list of risks, eliminating inconsequential or redundant ones and stratifying worthy ones in terms of importance and need for attention. This is risk assessment.

Choosing to move a concert indoors to eliminate the threat of bad weather is an example of ____________ a risk. transferring escalating avoiding mitigating retaining

avoiding Risk avoidance is changing the project plan to eliminate the risk or condition.

When considering risk response development, changing the plan to eliminate the risk or condition is known as ____________ the risk. transferring escalating avoiding retaining diminishing

avoiding Risk avoidance is changing the project plan to eliminate the risk or condition.

_____________ systems involve reporting, controlling, and recording changes to the project baseline. proactive management total management change management productive management production management

change management because change is inevitable, a well-defined change review and control process should be set up early in the project planning cycle. Change management systems involve reporting, controlling, and recording changes to the project baseline.

________ reserves are identified for specific work packages and are distributed by the project manager and the team members. incremental contingency additional work package incidental

contingency These reserves are identified for specific work packages or segments of a project found in the baseline contingency or work breakdown structure. For example, a reserve amount might be added to "computer coding" to cover the risk of "testing" showing a coding problem. The reserve amount is determined by costing out the accepted contingency or recovery plan. The contingency reserves should be communicated to the project team.

This response is used to increase the potential effect of an identified opportunity. exploit share enhance accept escalate

enhance Definition of an enhance response to an identified opportunity.

Which of the following responses best characterizes how to respond to a risk that has considerable upside, or opportunity? mitigate risk avoid risk transfer risk escalate risk retain risk

escalate risk When a risk appears to have considerable upside or opportunity, it is best to escalate or bring the risk to the attention of others who can act on it, exploit it.

The cost impact of a risk event occurring as a project proceeds through its life cycle tends to rise over the life of the project decline over the life of the project rise at first, but then begin to decline over the life of the project decline at first, but then begin to rise over the life of the project remain the same over the life of the project.

rise over the life of the project The cost impact of a risk increases over the life of the project. For example, the risk event of a design flaw occurring after a prototype has been made has a greater cost or time impact than if the flaw were discovered during the planning phase of the project.

The ________ form identifies each risk event, the likelihood of it occurring, the potential impact, when it may occur, and the degree of difficulty in detecting it. risk measurement mitigation detection difficulty risk assessment risk alleviation

risk assessment The risk assessment form is a tool used to measure the likelihood that a risk event will occur, the impact of the risk and how difficult it will be to detect.

Organizations use __________ in conjunction with work breakdown structures to help management teams identify and eventually analyze risk. risk breakdown structure contingency breakdown structures scenario analysis organizational breakdown structure risk assessment

risk breakdown structures Organizations use risk breakdown structures in conjunction with work breakdown structures to help management teams identify and eventually analyze risk. The focus at the beginning should be on risks that can affect the whole project as opposed to a specific section of the project or network.

The attempt to recognize and manage potential and unforeseen trouble spots that may occur when a project is implemented is known as risk forecasting risk management contingency planning scenario analysis disaster protection

risk management Risk management attempts to recognize and manage potential and unforeseen trouble spots that may occur when the project is implemented.

The table that shows each risk event as rows while columns will identify the name of the risk, the response to the risk, the contingency plan and the trigger is called what? responsibility assignment matrix risk response matrix risk identification table risk characterization table risk assessment table

risk response matrix Such a table is called a risk response matrix.

Which of the following is NOT one of the steps in the risk management process? risk response development risk assessment risk identification risk tracking risk response control

risk tracking The four steps in the risk management process are risk identification, risk assessment, risk response development and risk response control.

The risk management tool that is divided into three color-coded zones representing major, moderate, and minor risks is the risk assessment form responsibility matrix scenario assessment impact assessment severity matrix

severity matrix The risk severity matrix provides a basis for prioritizing which risks to address. Red zone risks receive first priority followed by yellow zone risks. Green zone risks are typically considered inconsequential and ignored unless their status changes.

When considering risk response development, passing risk to another party instead of changing it is known as ____________ the risk. transferring escalating avoiding retaining diminishing

transferring

The event or point in time when a contingency plan will be implemented is called a(n) _________. trigger milestone threshold contingency event execute event

trigger The risk management team will also need to discuss and agree on what would "trigger" implementation of the contingency plan.