Project Risk Management Terms

Technical Performance Measurement

A comparison of technical accomplishments during project execution with the schedule of technical achievement.

Risk Management Plan

A component of the project, program, or portfolio management plan that describes how risk management activities will be structured and performed.

Decision Tree Analysis

A diagramming and calculation technique for evaluating the implications of a chain of multiple options in the presence of uncertainty.

Risk Register

A document in which the results of risk analysis and risk response planning are recorded

Brainstorming

A general data gathering and creativity technique that can be used to identify risks, ideas, or solutions to issues by using a group of team members or subject matter experts.

Probability and Impact Matrix

A grid for mapping the probability of each risk occurrence and its impact on project objectives if that risk occurs.

Risk Category

A group of potential causes of risk.

Sensitivity Analysis

A quantitative risk analysis and modeling technique used to help determine which risks have the most potential impact on the project. It examines the extent to which the uncertainty of each project element affects the objective being examined when all other uncertain elements are held at their baseline values. The typical display of results is in the form of a tornado diagram.

Workaround

A response to a threat that has occurred, for which a prior response had not been planned or was not effective.

Risk Avoidance

A risk response strategy whereby the project team acts to eliminate the threat or protect the project from its Impact.

Risk Mitigation

A risk response strategy whereby the project team acts to reduce the probability of occurrence or impact of a risk.

Risk Acceptance

A risk response strategy whereby the project team decides to acknowledge the risk and not take any action unless the risk occurs.

Risk Transference

A risk response strategy whereby the project team shifts the impact of a threat to a third party, together with ownership of the response.

Secondary Risk

A risk that arises as a direct result of implementing a risk response.

Residual Risk

A risk that remains after risk responses have been implemented.

Simulation

A simulation uses a project model that translates the uncertainties specified at a detailed level into their potential impact on objectives that are expressed at the level of the total project.

Checklist Analysis

A technique for systematically reviewing materials using a list for accuracy and completeness.

Assumption Analysis

A technique that explores the accuracy of assumptions and identifies risks to the project from inaccuracy, inconsistency, or incompleteness of assumptions.

Trigger Condition

An event or situation that indicates that a risk is about to occur. Triggers are sometimes called risk symptoms or warning signs.

Risk

An uncertain event or condition that, if it occurs, has a positive or negative effect on one or more project objectives.

Data Precision

Describes the extent to which a risk is known or understood. Measures extent of data available as well as reliability of data.

Risk Consequences

Effect on project objectives if the risk event occurs.

Risk Audits

Examination and documentation of the effectiveness of risk responses in dealing with identified risks and their root causes, as well as the effectiveness of the risk management process.

Risk Thresholds

Measure of the level of uncertainty or the level of impact at which a stakeholder may have a specific interest

Risk Management Policies

Pre-defined approaches to risk analysis and response in some organizations that have to be tailored to a particular project.

Project Files

Records of previous project results that can be used to identify risks.

Risk Database

Repository that provides for collection, maintenance, and analysis of data gathered and used in the risk management process. Use of this database assists risk management throughout the organization and, over time, forms the basis of a risk lessons learned program.

Data Precision Ranking

Technique to evaluate the degree to which data about risks is useful for risk management.

Project Assumption Testing

Testing identified assumptions against two criteria: assumption stability and consequences on the project if the assumption is false.

Risk Appetite

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

Risk Tolerance

The degree, amount, or volume of risk that an organization or individual will withstand.

Plan Risk Management

The process of defining how to conduct risk management activities for a project.

Identify Risks

The process of determining which risks may affect the project and documenting their characteristics.

Plan Risk Responses

The process of developing options and actions to enhance opportunities and to reduce threats to project objectives. It includes the identification and assignment of one person (the `risk response owner`) to take responsibility for each agreed-to and funded risk response.

Documentation Reviews

The process of gathering a corpus of information and reviewing it to determine accuracy and completeness.

Control Risks

The process of implementing risk response plans, tracking identified risks, monitoring residual risks, identifying new risks, and evaluating risk process effectiveness throughout the project.

Perform Quantitative Risk Analysis

The process of numerically analyzing the effect of identified risks on overall project objectives.

Perform Qualitative Risk Analysis

The process of prioritizing risks for further analysis or action by assessing and combining their probability of occurrence and impact.

Project Risk Management

The processes of conducting risk management planning, identification, analysis, response planning, and controlling risk on a project.

Additional Risk Response Planning

This is done to take care of risks that were not identified in the risk response plan, or their impact on objectives is greater than expected.