Which of the following would be MOST useful when measuring the progress of a risk response action plan?
Click on the arrows to vote for the correct answer
A. B. C. D.C.
When measuring the progress of a risk response action plan, the MOST useful indicator would be the percentage of mitigated risk scenarios (Option C). Here is why:
A risk response action plan is created to address the identified risks in an organization's risk register, which details potential risks and their associated impacts. Once the plan is in place, it is important to measure the effectiveness of the actions taken in response to the identified risks. The following options are possible indicators of progress:
A. Resource expenditure against budget: This metric measures the amount of resources used against the budget allocated for the risk response plan. While it is a useful metric for measuring cost efficiency, it does not necessarily indicate progress in mitigating identified risks. An organization may spend its budget but still leave significant risks unmitigated, or may over-spend its budget without significantly reducing risks. Therefore, resource expenditure against budget is not the most useful metric for measuring progress in risk mitigation.
B. An up-to-date risk register: An up-to-date risk register is important for identifying new risks and tracking the status of existing risks, but it does not necessarily measure progress in risk mitigation. An organization may have an up-to-date risk register, but if it does not show a decrease in the number or severity of identified risks, it does not indicate progress in risk mitigation.
C. Percentage of mitigated risk scenarios: This metric measures the percentage of identified risks that have been mitigated through the risk response action plan. This is the most useful metric for measuring progress in risk mitigation because it directly measures the effectiveness of the risk response action plan in reducing identified risks.
D. Annual loss expectancy (ALE) changes: ALE is a measure of the expected monetary loss that would result from a risk scenario. A change in ALE can indicate progress in risk mitigation, but it is not as useful a metric as the percentage of mitigated risk scenarios because it is a more abstract measure that may not be as easily understood or interpreted by stakeholders.
In summary, while all of the options could be used to measure the progress of a risk response action plan, the MOST useful indicator would be the percentage of mitigated risk scenarios, as it directly measures the effectiveness of the risk response action plan in reducing identified risks.