Boost your Project Management Career with the Best Online Training

In the online learning space, everybody loves the quick win. 

Developing a Risk Response Plan – Part 2

Developing a Risk Response Plan – Part 2

The acceptance Strategy is used when you are not able to eliminate all the threats on the project. It is a strategy that can be used for risks that pose either threats or opportunities to the project.

There are two alternatives to the acceptance Strategy.

Passive acceptance

This means you will not make any plans to try to avoid or mitigate the risk, and you are willing to accept the consequences of the risk should it occur.

This strategy is often used when it is more cost effective to accept the impacts of the risk, than to spend time or resources developing plans to deal with the consequences.

Passive acceptance might also be used when the project team was unable to come up with an adequate response strategy, and must accept the risk and its consequences.

Active acceptance

This is a second strategy and might include developing contingency plans and reserves to deal with the risks should they occur. It is important to understand all the strategies and their characteristics to each plan risk responses tools and techniques for the exam.

Strategies for positive risks or opportunities

Four strategies exist to deal with opportunities or positive risks that might present themselves on the project. These are exploit, share, enhance, and accept.

I have already covered accept, so let us look at the next three:

Here, you are looking for opportunities for positive impacts. This is the strategy of choice when you have identified positive risks that you want to make certain will occur on your project.

Examples of exploiting a risk include reducing the amount of time to complete the project by bringing on more qualified resources, or by providing even better quality than originally planned.

This is like transferring, because you will assign the risk to a third-party owner who is best able to bring about the opportunity the risk event presents. Forming a joint venture with a marketing firm to capitalize on the positive risk is one example of making the most of opportunities.

This strategy closely watches the probability or impact of the risk event to assure that the organization realizes the benefits. The primary point of this strategy is to attempt to increase the probability and/or impact of positive risks.

This means watching for and emphasizing risk triggers and identifying the root causes of the risk to help enhance impacts or probability.

Risk Contingency planning

This last tool and technique in the plan risk responses process called contingent response strategy, is better known as contingency planning.

This involves planning alternatives to deal with certain risks such as those with accept Strategies, should they occur.

This is different from mitigation planning, in that mitigation looks to reduce the probability of the risk and its impact, whereas contingency planning does not necessarily intend to reduce the probability of a risk event or its impacts.

Contingency comes into play when the risk event occurs. This implies you need to plan for your contingents is well in advance of the threat or opportunity of occurring.

After the risks have been identified and quantified, contingency plans should be developed and kept at the ready.

Contingency reserves

These are a common contingency response for risk events, and a similar to those for cost and activity durations. This may include setting aside funding or resources or adding contingency time to the project schedule.

Fall-back plans

These should be developed for risks with high impact or for risks with identified strategies that might not be the most effective at dealing with the risk. Fallback plans are not contingency plans.

In practice, you will find that identifying, prioritizing, quantifying, and developing responses for potential threats might happen simultaneously. In any case, you do not want to be taken by surprise, and that is the point of the risk processes.

If you know about potential risks early, you can often mitigate them or prepare appropriate response plans or contingency plans to deal with them.

Pass YOUR PMP Exam At First Try HERE!

PMP Exam

Join The Projex Academy
Project Management Masterclass

Sign up to receive product updates and special offers from our team.