Categorizing risks by their impact on project objectives ensures that risk response plans are aligned

with project priorities. This helps in focusing on the most critical risks and their potential impact on

the project's success.

Categorizing risks by their impact to the project objectives is a way of aligning the risk management

process with the project goals and stakeholder expectations. By doing so, the risk management

professional can ensure that the risk response plans are focused on the most critical aspects of the

project and that the project priorities are being considered in the decision making. This approach can

also help to communicate the value of risk management to the project team and the stakeholders, as

they can see how the risk management activities are contributing to the project success.

Categorizing risks by their impact to the project objectives does not necessarily help to identify the

specific causes of risks, determine the level of project leadership and organizational involvement, or

assign risks and risk severities to functional disciplines and departments. These are other possible

ways of categorizing risks, but they are not the main purpose of using the impact to the project

objectives approach. Reference: PMI-RMP® Certification Handbook1, page 9; PMBOK® Guide, page

415.

The project manager should have performed risk identification exercises for the full lifecycle of the

project, including the construction phase, to ensure that all potential risks were identified and

addressed in the risk register.

Risk identification is the process of determining the risks that may affect the project and

documenting their characteristics. Risk identification should be performed throughout the project

lifecycle, as new risks may emerge or change over time. Risk identification should also consider all

aspects of the project, such as scope, schedule, cost, quality, resources, stakeholders, and

procurement. By performing risk identification exercises for the full lifecycle of the project, the

project manager could have identified and planned for the potential risks associated with the

construction phase, such as delays, material shortages, quality issues, or safety hazards. This would

have helped to prevent or mitigate the impact of the risk event that occurred, and to ensure that the

risk register is updated and comprehensive. Performing a Monte Carlo sensitivity analysis, adding

generic construction risks, or reviewing the assumptions/exclusions register are not sufficient or

effective ways of identifying the specific risks that may affect the project during the construction

phase. These are either tools for risk analysis, risk response planning, or project initiation, but not

risk identification. Reference: PMI-RMP® Certification Handbook1, page 9; PMBOK® Guide, pages

397-398.

With 25 identified risks, and considering the constraints and resources available, the appropriate

next step is to perform a qualitative risk analysis. This process helps prioritize the risks based on their

probability and impact, as well as other relevant factors like urgency, proximity, and detectability. By

doing so, the team can focus on the most significant risks that require immediate attention and

develop response plans accordingly, optimizing the use of available resources. PMI recommends this

approach to ensure that risk management efforts are both efficient and effective in addressing the

most critical risks first .

For a multi-million-dollar project with numerous risks, understanding the stakeholders' risk

thresholds based on their risk appetites is crucial. This helps in defining the boundaries within which

the project can operate and determine acceptable levels of risk. By confirming these thresholds, the

risk management team can ensure that the project remains aligned with stakeholders' expectations

and that appropriate risk responses are developed. This is a key step in the risk management process

as per PMI guidelines, which emphasize the importance of aligning risk management efforts with

stakeholders' risk tolerance and appetite .

According to the PMBOK Guide, risk prioritization is the process of assigning a level of importance to

each identified risk based on its probability and impact, as well as other factors such as urgency,

stakeholder tolerance, and project objectives. Risk prioritization helps the project team to focus on

the most significant risks and allocate resources accordingly. One of the tools and techniques for risk

prioritization is stakeholder engagement, which involves involving the key stakeholders in the risk

analysis and decision making process. Stakeholder engagement helps to ensure that the risk

prioritization reflects the expectations and p

of the stakeholders, and that they are aware

of and agree with the results. By engaging the key stakeholders during the prioritization process, the

risk manager could have avoided the board’s request to sort the risks differently, as the board would

have been part of the process and would have accepted the outcome. Reference: = PMBOK Guide,

6th edition, pages 406-407; The Standard for Risk Management in Portfolios, Programs, and Projects,

page 67.

Regression analysis is a data analysis tool that helps identify variables that impact the schedule and

determine how these factors interact. It is used to forecast future performance based on historical

data and the relationship between variables. (Reference: PMBOK Guide, 6th Edition, p. 248)

According to the PMI Risk Management Professional (PMI-RMP) Reference Materials, regression

analysis is a data analysis tool that examines the relationship between one or more independent

variables and a dependent variable1. Regression analysis can be used to forecast future performance

based on historical data and trends2. In this case, the risk manager wants to identify which variables

will impact the schedule (the dependent variable) and determine how these factors interact (the

independent variables). Therefore, the risk manager should use regression analysis to create a

mathematical model that can predict the schedule performance based on the values of the

variables. Regression analysis can also help the risk manager to assess the significance and strength

of the relationship between the variables and the schedule3.

Reference: 1: PMI, A Guide to the Project Management Body of Knowledge (PMBOK® Guide), Sixth

Edition, 2017, p. 720 2: PMI, Practice Standard for Project Risk Management, 2009, p. 95 3: Tips and

Tricks for Passing the Risk Management Professional (PMI-RMP …

According to the PMI Risk Management Professional (PMI-RMP)® Handbook1, one of the domains of

the PMI-RMP exam is Risk Monitoring and Reporting, which involves tracking identified risks,

monitoring residual risks, identifying new risks, executing risk response plans, and evaluating risk

process effectiveness throughout the project1. The risk manager of the related project should have

reformed the risk monitoring and closing process properly to ensure that the contingency budget is

only used for the intended risks and not for other purposes. The risk manager should have also

communicated the status and outcomes of the risk activities to the relevant stakeholders, such as the

functional manager and the CEO, to avoid any confusion or conflict over the budget

allocation1. Reference: 1: PMI Risk Management Professional (PMI-RMP)® Handbook, page 6.

The risk manager should have ensured a more accurate project work plan and budget to prevent the

functional manager from requesting to use the project's contingency budget. A well-planned budget

would have avoided the shortage in the functional manager's department budget.

When initiating a project to incorporate a cybersecurity team, the risk manager should first analyze

the following documents:

·        Industry's standard procedures: Understanding industry best practices and standards is critical

for setting up a cybersecurity team, as these procedures will guide the development of secure

processes and protocols.

·        IT infrastructure, networks, and data information: Analyzing the current IT infrastructure is

essential to identify vulnerabilities, assess risks, and plan for the necessary security measures that

the cybersecurity team will manage.

·        Government laws and regulations: Cybersecurity is a highly regulated area. Understanding the

relevant laws and regulations ensures that the project complies with all legal requirements and

avoids potential penalties.

These documents provide the necessary foundation to assess the risks and develop a comprehensive

cybersecurity strategy  .

The project manager should reassess risks by conducting a new assumptions and constraints

analysis. This will help identify any previously overlooked risks and ensure that the risk register is

comprehensive and up-to-date.

The first element the risk owner should look for in the response plan is to verify that due dates for

the actions have been identified. This ensures that risk mitigation actions are timely and can be

effectively monitored.

After identifying the risks and assigning risk owners, the next step is to develop risk response plans

that describe how to address each risk. The first element that the risk owner should look for in the

response plan is the due date for the actions that are required to implement the response. The due

date is important because it helps to prioritize the risk response activities, monitor the progress of

the risk response, and ensure that the response is executed in a timely manner. The due date also

helps to align the risk response with the project schedule and avoid any delays or conflicts. The other

elements, such as the probability of a secondary risk, the impact on the quality of the components,

and the relationship with the critical path, are also relevant for the risk response plan, but they are

not the first element that the risk owner should look for. Reference: PMI, 2017. A Guide to the

Project Management Body of Knowledge (PMBOK® Guide) – Sixth Edition. Newtown Square, PA:

Project Management Institute, Inc., pp. 407-4081