You are the project manager of GHT project. You have identified a risk event on your current project that could save $670,000 in project costs if it occurs. Your organization is considering hiring a vendor to help establish proper project management techniques in order to assure it realizes these savings. Which of the following statements is TRUE for this risk event?
This risk event is an opportunity to the project and should be exploited. When a risk event has positive potential outcomes, it is considered an opportunity. Exploiting a positive risk means taking direct actions to ensure that the opportunity is fully realized. In this case, hiring a vendor to help establish proper project management techniques is an active measure to ensure the project realizes the $670,000 savings.
The correct answer is: C. This risk event is an opportunity to the project and should be exploited. Exploiting a positive risk involves taking actions to ensure the opportunity is realized. In this case, hiring a vendor to help establish proper project management techniques can be seen as an effort to exploit the opportunity by increasing the chances of realizing the $670,000 savings.
D. This is a risk event that should be shared to take full advantage of the potential savings. Reasoning: Sharing a risk involves partnering with another party (e.g., a vendor or another organization) who can help manage the risk to achieve the desired outcome. While sharing might be a viable strategy in some cases, the most direct and proactive approach to ensure the opportunity is realized is to exploit it. Sharing might complicate the process and reduce the direct control over achieving the savings.
The decision between C and D hinges on the extent and nature of the vendor's involvement. If hiring the vendor is simply a means to better prepare the project to realize the savings (by improving project management practices), then it is more about exploiting the opportunity. If, on the other hand, the vendor is directly involved in the opportunity itself, taking a share of the savings or playing a major role in the actual realization of the opportunity, then it would be more of a sharing strategy. Based on the information provided, it seems that the vendor is being brought in to improve project management techniques, which is more aligned with preparing the project to capture the opportunity (Exploit) rather than sharing the opportunity with the vendor.
The scenario described presents a risk event that has a potential positive outcome (saving $670,000 in project costs). In risk management, such scenarios are typically referred to as opportunities rather than threats. The appropriate response in this case is C. This risk event is an opportunity to the project and should be exploited. Here's a breakdown of the response strategies: C. Exploited: When a risk event is an opportunity (positive risk), exploiting the risk means taking action to ensure that the opportunity is realized. In this case, hiring a vendor to establish proper project management techniques to assure the realization of these savings is an example of exploiting the opportunity.
The Answer is actually D. 3rd party is involved ! D. This is a risk event that should be shared
C. This risk event is an opportunity to the project and should be exploited. The risk event presents a positive opportunity rather than a threat. The risk event could lead to potential cost savings of $670,000 for the project.