Project Risk Management

Flashcard maker : Lily Taylor
A technique by which a group attempts to generate ideas or to find a solution for a specific problem by amassing ideas spontaneously and without judgement
Contingency Allowance
Provisions held by the project sponsor or organization to reduce the risk of cost or schedule overruns to an acceptable level; also called contingency reserves
Contingency Plans
Predefined actions that the project team will take if an identified risk event occurs
Contingency reserves
Provisions held by the project sponsor or organization to reduce the risk of cost or schedule overruns to an acceptable level; also called contingency allowance
Decision Tree
A diagramming analysis technique used to help select the best course of action when future outcomes are uncertain
Delphi Technique
An approach used to derive a consensus among a panel of experts to make predictions about future developments
Expected Monetary Value
The product of a risk event probability and the risk event’s monetary value
Fallback plans
Plans developed for risks that have a high impact on meeting project objectives and implemented if attempts to reduce the risk are not effective
Diagrams that show how various elements of a system relate to each other
Influence Diagram
A diagram that represents decision problems by displaying essential elements, including decisions, uncertainties, and objectives, and how they influence each other
A fact-finding technique that is normally done face to face, but can also occur through phone calls, emails, or instant messaging
Known Risks
Risks that the project team has identified and analyzed and that can be managed properly
Management reserves
Funds held for unknown risks
Monte Carlo Analysis
A risk quantification technique that simulates a model’s outcome many times to provide a statistical distribution of the calculated results
Probability/Impact Matrix or chart
A matrix or chart that shows the relative probability of a risk occurring and the relative impact of the risk
Residual Risks
Risks that remain after all of the response strategies have been implemented
An uncertainty that can have a negative or positive effects on meeting project objectives
Risk Acceptance
Accepting the consequences if a risk occurs
Risk Appetite
The degree of uncertainty an entity is willing to take on in anticipation of a reward
Having a low tolerance for risk
Risk Avoidance
Eliminating a specific threat or risk, usually by eliminating its causes
Risk Breakdown structure
A hierarchy of potential risk categories for a project
Risk Enhancement
Changing the size of an opportunity by identifying and maximizing key drivers of the positive risk
Risk Events
Specific uncertain events that may occur to the detriment or enhancement of the project
Risk Exploitation
Doing whatever you can to make sure a positive risk happens
Risk Factors
Numbers that represent the overall risk of specific events, given their probability of occurring and the consequences to the project if they do occur
Risk Management Plan
A plan that documents the procedures for managing risk throughout a project
Risk Mitigation
Reducing the impact of a risk event by reducing the probability of its occurence
A balance between risk and payoff
Risk Owner
The person who will take responsibility for a risk and its associated response and tasks
Risk Register
A document that contains results of various risk management processes, often displayed in a table or spreadsheet format
Having a high tolerance for risk
Risk sharing
Allocating ownership of a risk to another party
Risk Tolerance
The maximum acceptable deviation an entity is willing to accept on a project or business objectives as the potential impact
Risk Transference
Shifting the consequence of a risk and responsibility for its management to a third party
Risk utility
The amount of satisfaction or pleasure received from a potential payoff
Runaway Projects
Projects that have significant cost or schedule overruns
Secondary Risks
Risks that are a direct result of implementing a risk response
Sensitivity Analysis
A technique used to show the effects of changing one or more variables on an outcome
Top Ten Risk Item Tracking
A qualitative risk analysis tool for identifying risks and maintaining an awareness of risks throughout the life of a project
Indications for actual risk events
Unknown Risks
Risks that cannot be managed proactively because they have not been identified and analyzed
Watch list
A list of risks that have low priority but are still identified as potential risks
Unplanned responses to risk events when no contingency plans are in place
Planning Risk Management
Involves deciding how to approach and plan risk management activities for the project
Identifying Risks
Involves determining which risks are likely to affect a project and documenting the characteristics of each
Performing Qualitative Risk Analysis
Involves prioritizing risks based on their probability and impact of occurance
Performing Quantitative Risk Analysis
Involves numerically estimating the effects of risks on project objectives
Planning Risk Responses
Involves taking steps to enhance opportunities and reduce threats to meeting project objectives
Controlling Risks
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

Get instant access to
all materials

Become a Member