Question

Create a project risk management document for a hair product company using the following headings: planning,identification,qualitative analysis,quantitative analysis.response planning,response implementation and monitoring.

Answer 1

PROJECT MANAGEMENT PROFESSIONAL (PMP)

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• Opencampus  Project Management Professional (PMP) Plan Risk Responses

Risk Identification and Analysis

Implement and Monitor Risks

Plan Risk Responses

The risk response planning involves determining ways to reduce or eliminate any threats to the project, and also the opportunities to increase their impact. Project managers should work to eliminate the threats before they occur. Similarly, the project managers should work to ensure that opportunities occur. Likewise, the project manager is also responsible to decrease the probability and impact of threats and increase the probability and impact of opportunities.

For the threats that cannot be mitigated, the project manager needs to have a robust contingency plan and also a response plan if contingencies do not work.

It is not required to eliminate all the risks of the project due to resource and time constraints. A project manager should review risk throughout the project. Planning for risks is iterative. Qualitative risk, quantitative risk, and risk response planning do not end ones you begin work on the project.

Risk Response Strategies

The choices of response strategies for THREATS include:

AVOID: Focus on eliminating the cause and thus, eliminating the threat.

MITIGATE: There are certain risks that cannot be eliminated. However, their impact can be reduced. This is termed as mitigation of risks.

TRANSFER: Transfer the risk to some other party. Insurance purchases, warranties, guarantees, etc are examples of risk transfers

The choices of response strategies for OPPORTUNITIES include:

EXPLOIT: Add work or change the project to make sure the opportunity occurs

ENHANCE: Increase the probability and positive impact of risk events

SHARE: Allocate ownership of opportunity to a third-party

A response strategy for BOTH threats and opportunities:

ACCEPT: Passive acceptance leaves action to be determined as needed, in case of a risk event. Active acceptance may involve contingency plans to be implemented if risk occurs and allocation of time and cost reserves to the project. A decision to accept risk must be communicated to stakeholders.

ESCALATE: Risks which cannot be monitored and handled by the project are escalated to the upper level, for example to program management.

Whenever the project manager is responding to threats or opportunities:

• Execution of strategies must be time-bound

• Effort selected must be appropriate to the severity of the risk

• A single response can be an act of multiple risk events

• A strategy can be selected not only by the project manager but also by the team, the stakeholders and experts

Outputs Of Plan Risk Responses

Risk register, project management plans and project documents need to be updated as outputs of Plan Risk Responses.

Project Management Plan Updates

Project Management Plan can be updated by new work activities/packages that could be added, removed, or assigned to different resources, thus, making planning an iterative process.