Risk Management Professional - PMI-RMP Practice Exam
Risk Management Plan. The risk management plan is a
component of the project management plan that describes how risk management
activities will be structured and performed. The risk management plan
may include some or all of the following elements:
i.
Risk strategy. Describes the general
approach to managing risk on this project.
ii.
Methodology. Defines the specific approaches,
tools, and data sources that will be used to perform risk management on the
project.
iii.
Roles and responsibilities. Defines the lead,
support, and risk management team members for each type of activity described
in the risk management plan, and clarifies their responsibilities.
iv.
Funding. Identifies the funds needed to perform
activities related to Project Risk Management. Establishes protocols for the
application of contingency and management reserves.
v.
Timing. Defines when and how often the Project
Risk Management processes will be performed throughout the project life cycle,
and establishes risk management activities for inclusion into the project
schedule.
vi.
Risk categories. Provide a means for grouping
individual project risks. A common way to structure risk categories is with
a risk breakdown structure (RBS), which is a hierarchical representation
of potential sources of risk. An RBS helps the project team consider the
full range of sources from which individual project risks may arise. This can
be useful when identifying risks or when categorizing identified risks.
vii.
Stakeholder risk appetite. The risk appetites of key stakeholders on the project are
recorded in the risk management plan, as they inform the details of the Plan
Risk Management process. In particular, stakeholder risk appetite should be
expressed as measurable risk thresholds around each project objective. These
thresholds will determine the acceptable level of overall project risk
exposure, and they are also used to inform the definitions of probability
and impacts to be used when assessing and prioritizing individual project risks.
viii.
Definitions of risk probability and impacts.
Definitions of risk probability and impact levels are specific to the
project context and reflect the risk appetite and thresholds of the
organization and key stakeholders. The project may generate specific
definitions of probability and impact levels or it may start with general
definitions provided by the organization.
ix.
Probability and impact matrix. Prioritization
rules may be specified by the organization in advance of the project and be
included in organizational process assets, or they may be tailored to the
specific project. Opportunities and threats are represented in a common
probability and impact matrix using positive definitions of impact for
opportunities and negative impact definitions for threats. Descriptive terms (such
as very high, high, medium, low, and very low) or numeric values can be used
for probability and impact. Where numeric values are used, these can be
multiplied to give a probability-impact score for each risk, which allows the
relative priority of individual risks to be evaluated within each priority
level. An example probability and impact matrix is presented in figure below,
which also shows a possible numeric risk scoring scheme.
xi.
Tracking. Tracking documents how risk activities
will be recorded and how risk management processes will be audited.
Risk Breakdown structure: [Tool] A hierarchically organized depiction of the identified project risks arranged by risk category and subcategory that identifies the various areas and causes of potential risks. It is often tailored to specific project types.
Criteria for valid risk management plan includes: Acceptance by stakeholders; Alignment with internal and external constraints on project; Balance between cost/effort and benefit; and Fulfil requirements of Project Risk Management process.
3 critical success factors for the Plan Risk Management process are:
• Identify and address barriers to successful Project Risk Management
• Involve project stakeholders in Project Risk Management
• Comply with the organization’s objectives, policies, and practices.
The risk management plan should indicate the intensity
of effort and the frequency with which the various Project Risk Management
processes should be applied.
