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CAPM Exam Prep Flashcards - PMBOK 6th Edition (Joseph Phillips version) > 11 - Project Risk Management Terms > Flashcards

11 - Project Risk Management Terms Flashcards

1
Q

Acceptance

A

A risk response appropriate for both +VE and -VE risks. Often used for smaller risks within a project.

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2
Q

Ambiguity risks

A

Risks that have an uncertain, unclear nature, such as new laws or regulations, the marketplace conditions and other risks that are nearly impossible to predict.

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3
Q

Avoidance

A

A risk response to avoid the risk

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4
Q

Brainstorming

A

The most common approach to risk identification. Usually completed with SMEs

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5
Q

Business risks

A

Risks that may have +VE or -VE outcomes.

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6
Q

Cardinal scales

A

A ranking approach to identify the probability and impact by using a numerical value from 0.01 (low) to 1.0 (certain)

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7
Q

Checklists

A

A quick and cost-effective risk identification approach

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8
Q

Data precision

A

The consideration of the risk ranking scores. Takes into account bias, the accuracy of the data submitted, and the reliability of the nature of the data submitted.

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9
Q

Decision tree

A

A method to determine which of two or more decisions is the best one. The model examines cost/benefits of each decision outcome, and weighs the probability of success for each decision.

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10
Q

Delphi technique

A

An anonymous method of querying experts about foreseeable risks within a project/phase/component of a project. The goal is to gain consensus on project risks within the project.

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11
Q

Enhancing

A

A risk response that attempts to enhance the conditions to ensure that a positive risk event will likely happen

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12
Q

Escalating

A

A risk response that is appropriate for both +VE and -VE risk events that may be outside of the PM’s authority to act upon.

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13
Q

Expected monetary value (EMV)

A

Monetary value of a risk exposure:
risk probability x $ impact
Used in quantitative analysis.

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14
Q

Exploit

A

A risk response that takes advantage of the +VE risk within a project.

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15
Q

External risks

A

Risks that are outside of a project, but directly affect it (e.g. legal/labor issues, weather etc…)
“Force majeure” risks call for disaster recovery rather than project management.

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16
Q

Flowcharts

A

System/process flowcharts show the relationship between components and how the overall process works.
Useful for identifying risks between components.

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17
Q

Influence diagrams

A

Charts out a decision problem. Identifies all of the elements, variables, decisions, and objectives and also how each factor may influence another.

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18
Q

Ishikawa diagrams

A

AKA Fishbone diagrams. Cause and effect diagrams used to find the root cause of factors that are causing risks within the project.

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19
Q

Low-priority risk watch list

A

Low priority risks are identified and assigned to a watch list for periodic monitoring

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20
Q

Mitigation

A

A risk response effort to reduce the probability and/or impact of an identified risk in the project.

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21
Q

Monte Carlo technique

A

A simulation completed using a computer software that can simulate a project, using values for all possible variables, in order to predict the most likely model.

22
Q

Ordinal scales

A

A ranking approach that identifies and ranks the risks from very high to very unlikely or to some other value.

23
Q

PESTLE

A 
A prompt list used for risk identification in the following domains:
Political
Economical
Social
Technological
Legal
Environmental
24
Q

Probability and impact matrix

A

A matrix that ranks the probability of a risk event occurring and its impact on the project if the event DOES happen. Used in qualitative and quantitative risk analyses.

25
Q

Project management risks

A

Risks dealing with the unsuccessful mgmt of the project.

Eg. unsuccessful allocation of time/resources/scheduling, unacceptable results

26
Q

Pure risks

A

Risk with only a -VE outcome

27
Q

Qualitative risk analysis

A

An approach that “qualifies” the risks that have been identified in the project.
Analyzes and prioritizes risks based on their probability of occurring and impact.

28
Q

Quantitative risk analysis

A

Numerically assesses the probability and impact of the identified risks. Creates an overall risk score for the project.

29
Q

RAG rating

A 
Ordinal scale, uses 
RED
AMBER
GREEN
to capture probability, impact and risk score
30
Q

Residual risk

A

Risks that are expected to remain after a risk response.

31
Q

Risk

A

An uncertain project event/condition that may have a +VE or -VE impact.

32
Q

Risk identification

A

Systematic process of combing through the project, the project plan, the WBS and all supporting documentation to identify as many risks as possible that may affect the project

33
Q

Risk management plan

A

A project management subsidiary plan that defines how risk will be identified, analyzed, responded to and monitored within the project.
Also identifies the iterative risk management process the project is expected to adhere to.

34
Q

Risk management planning

A

Agreed-upon approach to the management of the project risk process.

35
Q

Risk owners

A

Individuals or entities that are responsible for monitoring and responding to an identified risk within the project.

36
Q

Risk register

A

A project plan component that contains all of the information related to the risk management activities. It’s updated as risk management activities are conducted to reflect the status, progress and nature of the project risks.

37
Q

Risk report

A

Explains the overall project risks and provides summaries about individual project risks.

38
Q

Risk response audit

A

An audit to test the validity of the established risk responses.

39
Q

Risk responsibilities

A

The level of ownership an individual or entity has over a project risk.

40
Q

Risk score

A

Calculated score based on each risk’s probability and impact. The approach can be used in both qualitative and quantitative risk analysis.

41
Q

Root cause identification

A

Aims to find identify the causal factors for risk event, and then how to events can be mitigated or eliminated.

42
Q

Secondary risks

A

New risks that are created as a result of a risk response.

43
Q

Sensitivity analysis

A

A quantitative risk analysis tool that examines each risk to determine which one has the largest impact on the project’s success.

44
Q

Sharing

A

A risk response that shares the advantages of a +VE risk within a project

45
Q

SWOT analysis

A 
Examining the project from the perspective of each of the following characteristics:
Strengths
Weaknesses
Opportunities
Threats
46
Q

TECOP

A 
A prompt list used in risk management to examine the below factors in a project:
Technical
Environmental
Commercial
Operational
Political
47
Q

Technical, quality, or performance risks

A

Technical risk: new, unproven, or complex technologies

Quality/performance risk: levels set for expectations of impractical quality/performance.

48
Q

Transference

A

A risk response that transfers the risk ownership to another party. (E.g. insurance, licensed contractors)
A fee and a contractual relationship are generally involved with the transference of risk.

49
Q

Variability risk

A

A type of risk based on the variations that may occur in the project (e.g. production, number of quality errors, or even weather).

50
Q

VUCA

A 
A prompt list used in risk identification that examines the below risk factors within a project:
Volatility
Uncertainty
Complexity
Ambiguity

CAPM Exam Prep Flashcards - PMBOK 6th Edition (Joseph Phillips version) (14 decks)

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