Risk Management Procedure
Question
Scenario - A photographer from Portraits Ltd, a professional photographic company, has taken on the role of Team Manager after taking some time to understand the requirements of the project.
A contract for their services has been set up and is being monitored by the Purchasing Manager and a Work Package has been agreed.
This contract specifies that the photographer must arrange a meeting with the Engineering Manager to establish a schedule for the photo sessions to minimize the impact on the Engineering staff.
This meeting should have occurred by now.
The Engineering Manager was made aware of this requirement but when asked he reported that he has received no communication from the photographer.
The Project Manager has tried to call the photographer and has had no response.
The Project Manager believes there is a risk that Portraits Ltd are overbooking work and prioritizing other clients' work.
If Portraits ltd do not deliver on schedule the project will be delayed and the expected benefits will be reduced.
The contract is to be reviewed and Portraits Ltd reminded of their agreement.
The project is now in stage 2
The Project Manager has heard about the possibility of a competitor also producing a calendar to be delivered earlier than the target date for this project.
There is a threat that the early release of a competitor's calendar may weaken the impact of the MNO Manufacturing Company calendar, thereby reducing the anticipated benefits of the Calendar project.
Which 2 statements should be recorded under the Risk management procedure heading?
Answers
Explanations
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A. B. C. D. E.BD.
Based on the scenario provided, there are several risks that need to be managed to ensure the successful delivery of the Calendar project. The two statements that should be recorded under the Risk management procedure heading are:
B. Probability will be assessed against the scales defined in this Risk Management Strategy. D. Every threat and opportunity identified must be clearly defined in terms of cause, event and effect.
Explanation:
B. Probability will be assessed against the scales defined in this Risk Management Strategy: Probability is the likelihood of a risk occurring, and it is important to assess the probability of each risk to prioritize the risks that need to be managed. The Risk Management Strategy should define the scales to assess the probability of each risk. For example, a common scale to assess probability is low, medium, and high. In this case, the risk of Portraits Ltd overbooking work and prioritizing other clients' work should be assessed for its probability of occurring. The Risk Management Strategy should also define the criteria for each probability level, such as the likelihood of occurrence percentage, to ensure a consistent assessment across all risks.
D. Every threat and opportunity identified must be clearly defined in terms of cause, event and effect: To manage risks effectively, it is essential to clearly define each risk, including its cause, event, and effect. Defining the cause of a risk helps to understand the root of the problem, while defining the event helps to identify when the risk may occur. Defining the effect helps to understand the impact of the risk on the project objectives and Business Case. In this case, the risk of the competitor producing a calendar to be delivered earlier than the target date should be clearly defined in terms of cause, event, and effect. For example, the cause of the risk may be the competitor having a more efficient production process, the event may be the competitor announcing an early release date, and the effect may be the reduced impact of the MNO Manufacturing Company calendar on its intended audience.
A. When a new problem arises, a full impact analysis will be undertaken to assess the impact on the project' objectives and Business Case: While it is important to assess the impact of a new problem on the project objectives and Business Case, this statement does not address the management of risks. This statement may be more appropriate under the Change management procedure heading.
C. Any risk which has an expected value of more than £1 k will NOT be registered: This statement is not a best practice for risk management. All risks, regardless of their expected value, should be registered and managed. The Risk Management Strategy should define the criteria for risk registration, such as the likelihood and impact of the risk, to ensure that only significant risks are prioritized for management.
E. 'Reduce' Response actions which result in a lower impact and/or probability rating: While reducing the impact and/or probability of a risk is a valid response action, this statement does not provide guidance on how to manage risks. The Risk Management Strategy should define a range of response actions, including avoidance, mitigation, transfer, and acceptance, to ensure that risks are managed effectively based on their likelihood and impact.
