Chapter 9 Risk Planning

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Questions and Answers

What is the first step in identifying potential project risks?

Create the Risk Register

Review the project schedule

Consider everything that could possibly go wrong (correct)

Assess the probability and impact of risks

How can the probability of a risk occurring be quantitatively expressed?

10% (correct)

Critical

High

Moderate

Which of the following is NOT a typical area of risk for marketing projects?

Project management

Project definition

Staffing

Project duration (correct)

What does the Risk Score formula consider?

Probability and impact factors Signup and view all the answers

Which risk probability factor corresponds to a likelihood of 0.5?

Possible Signup and view all the answers

In the context of risk assessment, what does a risk with an impact factor of 10 indicate?

Critical impact on the project Signup and view all the answers

Which method is NOT mentioned as a way to identify project risks?

Use of advanced data analytics Signup and view all the answers

What is typically included in a Risk Register?

Identified risks and their assessments Signup and view all the answers

Which of the following statements about risk management is true?

Managing risks involves both identification and analysis. Signup and view all the answers

What type of planning focuses on how risks will be managed in a project?

Risk Planning Signup and view all the answers

What does a probability/impact matrix assess?

The relative probability of a risk occurring and its impact Signup and view all the answers

Which of the following is NOT a risk response strategy?

Risk assessment Signup and view all the answers

What is residual risk?

Risks that occur after all response strategies are implemented Signup and view all the answers

If a parent buys a warranty to cover a potential phone screen crack, which risk response strategy is being used?

Risk transfer Signup and view all the answers

What does a contingency plan involve?

Determining actions if a risk occurs Signup and view all the answers

In the context of risk management, what does mitigation mean?

Reducing the likelihood or impact of a risk Signup and view all the answers

How can the weather risk for an outdoor wedding be mitigated?

Setting up a tent to protect against rain Signup and view all the answers

Which of the following is an example of risk acceptance?

Deciding to do nothing and hope for the best Signup and view all the answers

If a risk occurs even with preventive measures in place, what can be said about the remaining risk?

It is classified as residual risk Signup and view all the answers

Which term describes actions taken to avoid a risk entirely?

Risk avoidance Signup and view all the answers

Study Notes

Project Risk Planning

During the initiation phase of a project, it's crucial to identify and assess potential risks to ensure a successful project outcome.
Risk identification involves brainstorming and discussing potential issues with various stakeholders, including project team members, clients, and experts.
The process might involve analyzing previous projects, conducting SWOT analyses, and carefully examining the project scope for potential vulnerabilities.
Risk assessment helps determine both the likelihood of a risk occurring and its potential impact on the project.
Probability and impact may be assessed qualitatively using terms like "high," "medium," or "low" or quantitatively using percentages for probability and dollar amounts for impact.
A Risk Score is calculated by multiplying the probability factor (e.g., 0.8 for likely) with the impact factor (e.g., 10 for critical).
A visual tool known as a probability/impact matrix or chart helps categorize risks based on their likelihood and impact for a qualitative assessment.
Each risk identified should be documented in a comprehensive Risk Register, which also includes a risk score for each identified risk.

Managing Project Risks

Once risks are identified, risk management involves creating strategies to address them proactively.
Risk Acceptance means acknowledging the risk and deciding not to take any action, hoping for the best.
Risk Mitigation involves taking steps to reduce the likelihood of a risk occurring or minimizing its impact.
Risk Avoidance completely eliminates the risk by changing the project plan or taking alternative action.
Risk Transfer shifts the risk to another party, often via insurance or contractual agreements.
Residual Risks refer to risks that remain even after implementing risk response strategies.
Contingency Plans are actions taken in response to a risk actually occurring. They serve as backup plans to recover from a risk event.
All risk mitigation strategies and risk avoidance actions, along with contingency plans, should be documented in the Risk Register.

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Description

Test your knowledge on the key concepts of project risk planning, including risk identification and assessment techniques. This quiz will cover strategies such as brainstorming with stakeholders, SWOT analyses, and calculating risk scores. Ensure your understanding of how to effectively manage project risks for successful outcomes.