Questionnaire 04 – Risk Analysis

During project planning, after the team lists many risks, the sponsor asks what should be done. The risk manager explains that the next step is to assess the risks qualitatively in order to decide which risks justify a more in-depth quantitative analysis. What is the main objective of risk analysis in this context?

During the risk identification sessions, a project team has identified over 100 risks to the project. The risk manager believes that quantitatively assessing each of these risks will take too long, since not all of them are critical enough to warrant such an action. What should he do next?

A project will be carried out in three countries and involves a high level of uncertainty. The project team calculated the critical path duration and found it to be 322 days. They performed a Monte Carlo analysis as part of the quantitative risk analysis which resulted in the diagram below. The customer requested that the confidence level be 80%. What is the amount of the contingency reserve that needs to be included in the project to reach an 80% confidence level?

A project manager needs to model project risks by running simulations that calculate random outcomes and probabilities. Which risk analysis tool should the project manager use?

During the execution of a project, a new technology is launched on the market, promising to accelerate development activities by 30%. The team shows enthusiasm, but also identifies important risks: lack of knowledge, unknown learning curve, and limited supplier support. The risk manager is asked to help determine whether adopting the technology will bring net benefit to the project. What is the most appropriate approach to support this decision?

To determine how accurate and well understood the project risk information is, it must be analyzed. And you also need to determine whether more research is needed before a qualitative assessment can be made. It is most important to complete which of the following?

A tornado diagram like the one above is a typical representation of which quantitative risk analysis tool?

A project manager has already identified a number of risks for his project and has performed a quantitative analysis of them. The sponsor requests that he submit the calculations regarding exposure to aggregated risks, which were made in the quantitative analysis. How should the project manager calculate the overall project risk exposure?

During project risk planning, the project manager of a large software development project and his team are trying to decide whether to invest $800,000 to develop new software or invest $400,000 to upgrade existing software. The team is not sure how strong the demand for its product will be and therefore must factor this uncertainty into its analysis. What would be the best technique for the project manager to use in this case?

While planning a project to implement a new system, the team identified a risk of power failure, which could delay the project by up to 20 days and generate an additional cost of R$200,000. It is possible to install a backup generator, costing R$80,000, which reduces the probability of failure from 40% to 10%. To support the decision on which alternative to adopt, a decision tree analysis is used. Why use this technique?