Plan and Manage Risk

Risk strategies split by type. For threats (negative risks): avoid (eliminate the cause), mitigate (reduce probability or impact), transfer (shift the risk to a third party, e.g. insurance or a fixed-price contract), accept (do nothing, or set aside a contingency reserve). For opportunities (positive risks): exploit (make it happen), enhance (increase probability/impact), share (partner with a third party to capture it), accept.

Quantitative analysis tools worth memorizing: Expected Monetary Value (EMV = probability × impact, summed across outcomes) and decision trees for comparing paths with different EMVs. Qualitative analysis uses a probability/impact matrix to rank and prioritize risks for further analysis or response.

Study focus: PMI expects risk identification to be continuous and to include the whole team, not a one-time activity owned solely by the PM at kickoff — a frequently tested distinction from older, more PM-centric risk models.