Pass the PMI PMI Certification PMI-RMP Questions and answers with CertsForce

When a project is delayed, and all contingency reserves have been exhausted, the next step is to escalate the situation to upper management. This escalation allows for additional resources or support to be considered and for strategic decisions to be made at a higher level. According to PMI’s risk management practices, escalation is a key strategy when risks exceed the project's control, requiring input or intervention from senior management to resolve​.

Top of Form

Bottom of Form

Since the probability and impact the risk are both low, it is appropriate to put the risk on the watch list. This allows the risk manager to monitor the risk without expending significant resources on it.

 A watch list is a list of low-priority risks that are not actively managed, but are monitored for changes. A watch list can help the risk manager to keep track of the risks that have low probability and low impact, and to reassess them periodically. Putting the risk on the watch list is the most appropriate action for the risk manager, as it allows him or her to document the risk and review it later. Seeking guidance from SMEs, ignoring the risk, or informing the stakeholders are not necessary actions for a low-priority risk, as they would consume time and resources that could be better spent on more critical risks. References: PMI Risk Management Professional (PMI-RMP) Examination Content Outline and Specifications1, page 10; A Guide to the Project Management Body of Knowledge (PMBOK® Guide) – Sixth Edition, page 406.

Project risks should be closed when the stakeholders agree a risk is no longer applicable. This ensures that risks are actively managed and only relevant risks are considered throughout the project lifecycle.

According to the PMI Risk Management Professional (PMI-RMP) Reference Materials, project risks are uncertain events or conditions that may have a positive or negative effect on one or more project objectives1. Project risks can be closed when they are no longer applicable to the project or its activities. The process of closing project risks involves verifying that the risk responses have been completed, documenting the outcomes, and evaluating the effectiveness of the risk management process2. The decision to close a project risk should be made by the stakeholders who are responsible for or affected by the risk, as they are the ones who can determine whether the risk is still relevant or not. Therefore, the correct answer is B. When the stakeholders agree a risk is no longer applicable.

Monitoring risks during a project's lifecycle involves tracking identified risks and ensuring that response plans remain viable and effective. This continuous monitoring helps ensure that the project is prepared to address risks as they arise and that the risk response strategies remain appropriate as the project progresses. PMI guidelines stress the importance of ongoing risk monitoring to adapt to changes in the project environment and to ensure that the project remains on track to meet its objectives​​.

At the risk strategy and planning stage, the risk manager’s primary responsibility is to define the risk management processes and tools to be used for the project. This is foundational and comes before identifying individual risks or updating communication plans.

"The first step in risk management planning is to define how to conduct risk management activities, including processes, tools, and techniques that will be used on the project."

— PMBOK® Guide, 6th Edition, Section 11.1 (Plan Risk Management)

ISO 31000 similarly emphasizes that the establishment of the risk management context, processes, and tools is critical at the planning stage, especially for projects involving multiple stakeholders and locations.

Including project risks as a permanent agenda item in periodic project progress meetings helps in several ways:

1. Monitoring Variances and Trends (A): Regular discussions on risks allow the project team to monitor any variances and trends in the project’s risk profile. This ongoing assessment ensures that any deviations from the expected risk levels are promptly identified and addressed.

2. Utilization of Lessons Learned (C): Frequent risk discussions enable the project team to apply lessons learned from previous risks more effectively. This helps in refining risk responses and improving the overall risk management process.

3. Updating the Risk Register and Closing Out Expired Risks (E): Regular meetings ensure that the risk register is consistently updated, including the closure of risks that are no longer relevant or have expired. This keeps the risk management documentation current and accurate, which is essential for effective project management​.

According to the PMBOK Guide, the risk owner is the person assigned the responsibility of monitoring the risk and implementing the risk response plan. The risk owner should be involved in the risk response execution and evaluation, and should communicate the results and outcomes to the relevant stakeholders. In the case of a data breach, the risk owner should coordinate a response with the risk manager and other parties involved, such as the security team, the legal team, the customer service team, and the senior management. The risk owner should also report the status of the risk and the effectiveness of the response plan to the risk manager. The risk manager should oversee the risk response process and ensure that the risk is handled appropriately and in alignment with the project objectives and stakeholder expectations. References: = PMBOK Guide, 6th edition, pages 452-453; The Standard for Risk Management in Portfolios, Programs, and Projects, page 79.

If a risk still leaves substantial residual risk after implementing the mitigation strategy, the risk manager should revisit the risk register and redefine the mitigation strategy to reduce the residual risk to an acceptable level.

According to the PMBOK Guide, 6th edition, Chapter 11: Project Risk Management1, an effect of adding the correlation to the Monte Carlo schedule risk analysis model is that it increases the standard deviation of the model. This is because:

Correlation is the statistical relationship between two or more variables. In a schedule risk analysis, correlation can be used to model the dependency between the durations of different activities. For example, if two activities are positively correlated, it means that if one activity takes longer than expected, the other activity is also likely to take longer than expected. Conversely, if two activities are negatively correlated, it means that if one activity takes longer than expected, the other activity is likely to take shorter than expected.

A Monte Carlo schedule risk analysis is a simul-ation technique that uses random values for uncertain variables, such as activity durations, to generate possible outcomes for the project schedule. The simul-ation is repeated many times to produce a probability distribution of the project completion date and duration. The standard deviation is a measure of the variability or dispersion of the distribution. A higher standard deviation means that the distribution is more spread out and less predictable.

Adding correlation to the Monte Carlo schedule risk analysis model increases the standard deviation of the model because it introduces more variability and uncertainty to the simul-ation. Correlated activities can have a cumulative effect on the project schedule, either positively or negatively, depending on the direction and strength of the correlation. This can result in more extreme outcomes for the project completion date and duration, which increase the spread of the distribution and the standard deviation.

PMBOK Guide, 6th edition, Chapter 11: Project Risk Management1

Risk Management Professional (PMI-RMP)® Exam Cert Guide2

The project manager should assess and record associated secondary risks and proceed to treat them as any other risks. This involves identifying and evaluating the potential negative health effects of using pesticides and developing a plan to mitigate these risks. While it is important to consider the concerns of residents, the health authorities have determined that not moving forward with the plan will have more serious consequences on public health.

 Secondary risks are those that arise as a direct outcome of implementing a risk response. In this case, the use of pesticides is a risk response to limit the risks of harmful insects, but it may also cause negative health effects to some residents. This is a secondary risk that needs to be assessed and recorded in the risk register, along with its probability, impact, and response plan. The project manager should not suspend the project, as this would ignore the primary risk of harmful insects. The project manager should not consult with health experts to provide a risk trigger, as this is not a valid risk management technique. A risk trigger is an indication that a risk event is about to occur or has occurred, not a condition that prevents a risk response from being implemented. The project manager should not proceed with the project as normal, as this would neglect the secondary risk and its potential consequences. The project manager should follow the risk management process and treat the secondary risk as any other risk in the project. References: PMI. (2017). A Guide to the Project Management Body of Knowledge (PMBOK® Guide) – Sixth Edition. Chapter 11: Project Risk Management, p. 408. 5