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CAPM Review > Project Risk Management Terms > Flashcards

Project Risk Management Terms Flashcards

1
Q

Acceptance

A

A risk response appropriate for both positive and negative risks, but 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 by a project team with subject matter experts to identify the risks within the project

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5
Q

These risks may have negative or positive outcomes. Examples include : using a less experienced worker, allowing phases to overlap, or forgoing the expense of formal training

A

Business Risk

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6
Q

Cardinal Scales

A

A ranking approach to identify the probability and impact by using a numerical value, from .01 very 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 that takes into account any 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 the costs and benefits of each decision’s outcome and weighs the probability of success for each of the decisions

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10
Q

An anonymous method of querying experts about foreseeable risks within a project, phase or component of a project. The results of the survey are analyzed by a third party, organized, and then circulated to the experts.

A

Delphi Technique

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11
Q

Enhance

A

A risk response that attempts to enhace 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 positive and negative risk events that may outside of the PM’s authority to act upon

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13
Q

Expected Monetary Value (EMV)

A

The monetary value of a risk exposure based on the risk’s probability and impact in the risk matrix. This approach is typically used in quantitative risk analysis because it quantifies the risk exposure

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14
Q

Exploit

A

A risk response that takes advantage of the positive risks within a project

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15
Q

External Risks

A

These risks are outside of the project, but directly affect it. For example : Legal issues, labor issues, weather

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16
Q

Flowcharts

A

System or process flowcharts show the relationship between components and how the overall process works. These are useful for identifying risks between system components

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17
Q

Influence Diagrams

A

This diagram charts out a decision problem. It identifies all of the elements, decisions, and objectives and also how each factor may influence another

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18
Q

These cause and effect diagrams are also called fishbone diagrams and are used to find the root cause of factors that are causing risks within the project

A

Ishikawa Diagrams

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19
Q

Low-priority risk watch lists

A

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

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20
Q

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

A

Mitigation

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21
Q

A simulation technique using a computer software program that can simulate a project, using all possible variables

A

Monte Carlo Technique

22
Q

Ordinal Scales

A

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

23
Q

Organizational Risks

A

The performing organization can contribute to the project’s risks through unreasonable cost, time, and scope expectations; poor project prioritization; inadequate funding or the disruption of funding; and competition with other projects for internal resources

24
Q

PESTLE

A

A prompt list used for risk identification. PESTLE examines risks in the Political, Economic, Social, Technological, Legal, and Environmental Domains

25
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

26
Q

Pure Risks

A

These risks have only a negative outcome. Examples include loss of life or limb, fire, theft, natural disasters, and the like

27
Q

Qualitative Risk Analysis

A

This approach “qualifies” the risks that have been identified in the project. Specifically, qualitative risk analysis examines and prioritizes risks based on their probablity of occuring and their impact on the project should they occur

28
Q

Quantitative Risk Analysis

A

This approach attempts to numerically assess the probability and impact of the identified risks. It also creates an overall risk score for the project.

29
Q

RAG rating

A

An ordinal scale that uses red, amber, and green to capture the probability, impact, and risk score

30
Q

Residual Risks

A

Risks that are expected to remain after a risk response

31
Q

Risk

A

A project risk is an uncertain event or condition that can have a positive or negative impact on the project

32
Q

Risk Identification

A

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

33
Q

Risk Management Plan

A

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

34
Q

Risk Management Planning

A

The agreed-upon approach to the mangement of the project risk processes

35
Q

Risk Owners

A

The individuals or entities that are responsible for monitoring and responding to an indentified risk within the project

36
Q

Risk Register

A

The risk register is a project plan component that contains all of the information related to the risk management activites. 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

The risk report explains the overall project risks and provides summaries about the 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 project risk

40
Q

Risk Score

A

The 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

Root cause identification aims to find out why a risk event may be occuring, the casual factors for the risk events, and then, eventually, how the events can be mitigated or eliminated

42
Q

Secondary Risks

A

New risks 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 positive risk within a project

45
Q

SWOT Analysis

A

SWOT analysis is the process of examining the project from the perspective of each characteristic : strengths, weaknesses, opportunities, and threates

46
Q

TECOP

A

A prompt list used in risk identification to examine the Technical, Environmental, Commerical, Operational, and Political factors of the project

47
Q

Technical, Quality, or Performance Risks

A

Technical risks are associated with new, unproven, or complex technologies being used on the project. Changes to the technology during the project implementation can aslo be a risk. Quality risks are the levels set for expectations of impractical quality and performance

48
Q

Transference

A

A risk response that transfers the ownership of the risk to another party. Insurance, licensed contractors, or other project teams are good examples of this. A fee and contractural relationships are typicall involved

49
Q

Variability Risks

A

A type of risk based on the variations that may occur in the project, such as production, number of quality errors, or even the weather

50
Q

VUCA

A

A prompt list used in identification that examines the Volatility, Uncertainty, Complexity, and Ambiguity of risk factors within the project

CAPM Review (19 decks)

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