Risk Response Planning

Risk Response Planning: A Comprehensive Guide

Introduction to Risk Response Planning

Risk Response Planning is a critical component of project risk management that focuses on developing options and actions to enhance opportunities and reduce threats to project objectives. This process follows risk identification and assessment, providing structured approaches to handle each identified risk.

Why Risk Response Planning is Important

Risk Response Planning is essential because it:

• Transforms risk analysis into actionable strategies
• Aligns risk responses with project constraints and objectives
• Assigns clear ownership and responsibility for risk actions
• Allocates appropriate resources for risk management
• Establishes timeframes for response implementation
• Reduces uncertainty and minimizes negative impacts
• Maximizes potential opportunities
• Creates a documented plan that stakeholders can review and approve

Key Components of Risk Response Planning

1. Risk Response Strategies for Negative Risks (Threats)

• Avoid: Eliminating the threat by removing its cause (e.g., changing project scope or approach)
• Transfer: Shifting the impact and ownership of the risk to a third party (e.g., insurance, warranties, contracts)
• Mitigate: Reducing probability and/or impact of the risk to acceptable levels
• Accept: Acknowledging the risk but taking no proactive action (passive acceptance) or developing contingency plans (active acceptance)

2. Risk Response Strategies for Positive Risks (Opportunities)

• Exploit: Ensuring the opportunity definitely happens (analogous to avoid)
• Share: Allocating ownership to a third party best able to capture the opportunity (analogous to transfer)
• Enhance: Increasing probability and/or impact of the opportunity (analogous to mitigate)
• Accept: Taking advantage of the opportunity if it occurs but not pursuing it

3. Contingent Response Strategies

• Developing responses that will only be executed under certain predefined conditions
• Creating trigger points and warning signs to activate contingency plans

The Risk Response Planning Process

1. Review prioritized risks from the risk assessment phase
2. Select appropriate response strategies for each risk
3. Develop specific, actionable response plans
4. Determine resources required for implementation
5. Assign risk owners responsible for implementation
6. Establish timelines for response execution
7. Update risk register with response plans
8. Update project management plans as needed
9. Obtain necessary approvals

Documenting Risk Response Plans

Risk response information should be recorded in the risk register, including:

• Selected response strategies
• Specific actions to implement each strategy
• Primary and secondary risk owners
• Resource requirements and costs
• Timeline and schedule impacts
• Contingency and fallback plans
• Residual and secondary risks

Considerations for Effective Risk Response Planning

• Ensure responses are appropriate to the risk significance
• Consider cost-benefit analysis for each response
• Address both threats and opportunities
• Make sure responses are realistic and achievable
• Consider organizational constraints and project context
• Involve appropriate stakeholders in developing responses
• Account for potential secondary risks created by responses

Exam Tips: Answering Questions on Risk Response Planning

1. Strategy Selection Questions:
• Pay close attention to whether the risk is positive (opportunity) or negative (threat)
• Look for key phrases that indicate the best strategy (e.g., "eliminate the risk entirely" suggests avoid)
• Remember that similar strategies have different names for threats vs. opportunities

2. Scenario-Based Questions:
• Analyze whether the scenario describes a risk event or condition
• Identify if the question is asking about planning responses or implementing them
• Consider project constraints when selecting the most appropriate response

3. Process Questions:
• Understand risk response planning's place in the overall risk management process
• Know that it follows risk identification and analysis but precedes implementation
• Remember that new risks identified during response planning must go through the risk assessment process

4. Terminology Questions:
• Clearly differentiate between similar terms (e.g., accept vs. mitigate, transfer vs. share)
• Know the definitions of residual risks (those remaining after responses) and secondary risks (those created by responses)
• Understand the difference between contingency plans and fallback plans

5. Documentation Questions:
• Remember that risk responses are documented in the risk register
• Be familiar with the components that should be included in response documentation
• Understand how risk response plans integrate with other project documents

6. Role-Based Questions:
• Know the project manager's responsibilities in risk response planning
• Understand the role of risk owners and team members
• Recognize when stakeholders or subject matter experts should be involved

Remember that the PMI-RMP exam focuses on the application of knowledge rather than memorization of facts. Practice applying risk response concepts to various scenarios to prepare effectively.