Question

Group Assignment:

1.Why is your knowledge of Risk appetite and Risk threshold important in your Risk response strategy?

2.You had planned in your risk response to engage two additional programmers during the implementation stage of your project. Suddenly you realized that you may need a total of three. What are three possible things that you must do to ensure that the project is not delayed?

3.You are the project manager of a software development company. Your company receives supplies of chips from a foreign supplier. Their sales manager has approached you to inform you that if you can increase your order by 30%, the shipment will be free for your organization. This however will bring additional cost of $100 on your current budget that is $5000 p.a. What type of Risk is this? Identify at least three things you can do in response given consideration to best practices?

4.You have on your schedule to receive street light products from your regular vendor in July 2020.On the 10^th June 2020, you learnt from the news that the Vendor’s warehouse has been destroyed by fire and that they may not be able to recover in the next 12 months.

What type of Risk is this? Mention 4 possible things you will do?

5.Give 2 examples for each of the followings Risks that may apply to your project, 1Known unknown, 2 Unknown unknowns

Answer 1

Answer 1–

Risk Response strategy is planning the process of determining that what you will do with all the identified risks. Risk response strategies help in mitigating, avoiding, transferring or escalating the Risks. A risk response strategy depends on the stakeholders’ risk appetite, tolerance, and threshold. Knowledge of Risk appetite and Risk threshold is very important in Risk response strategy because of the following reasons –

· Risk appetite refers to the degree of uncertainty that one is willing to accept in exchange of a reward. If organisations or individuals can undertake higher risk to have higher rewards then it is said that they have higher risk appetite and vice versa. Thus, it is very important to know the risk appétit of company to make risk response strategy accordingly.

· Risk threshold is an exact amount or value of risk that one is willing to accept. This defines a limit, above which no risk is accepted. It is important to determine and know the limit of risk for your risk response strategy as no risk beyond that limit would be tolerated.

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