Practical Risk Management with Primavera Risk Analysis – Working with An Oil and Gas Industry Project

The Practical RMP with Primavera Risk Analysis course is used by risk management practitioners around the world, including PhD candidates pursuing their doctorates. Professionals from construction, software, EPC (engineering, procurement and construction), space and other industries use this course.

Currently, I received questions on its usage on in the oil and gas (O&G) industry. The question is on practical applicability in that industry. The Practical RMP course is industry transparent and uses its own project and builds-up step-by-step from risk planning, identification to risk monitoring and tracking. Along with the theory, you will learn to do risk management in a practical, hands-on manner. The later part, hands-on, is crucial. Above all, you can apply your learning in any industry.

Coming to the Oil and Gas industry, the Practical RMP course can be used and the risk management concepts can definitely be applied. For this article, I’m going to take a sample risk management plan. This is a .plan file as called in Primavera Risk Analysis (PRA) software tool. 

The .PLAN file

This plan is taken from the provided sample plans available in PRA tool. When imported to the software, it pops-up a message about cost uncertainty in this oil and gas project. 

Uncertainties can come in various ways:

• Duration uncertainty
• Cost uncertainty
• Network uncertainty, among others.

You can learn more on these uncertainties in this article. All these uncertainties can be modelled. 

Analyzing the .PLAN file 

Now that we have imported this file, we need to have a quick look on the plan, which is shown below. 

As shown:

• We have a number of activities under the heading “A” such as Civils, Buildings, Structural Steel & Painting, Mechanical Equipment Supply etc.
• Each of these activities have the cost shown – minimum fixed cost, maximum fixed cost and most likely fixed cost.
• For example, the ‘Structural Steel & Painting’ activity has minimum fixed cost of $900,000, maximum fixed cost of $1,100,000 and most likely fixed cost of $1,300,000.

The resources are fixed cost for these activities and the cost uncertainty has been shown for each. The default probability distribution has been used for them. 

The overall project statistics is shown below. This is can be seen by going to Plan menu > Plan Information … > Statistics tab.  

As you can see, the total planned cost is $19.123 M (million) and the planned finish is 31 October, 2025. I’ve changed the date of the plan. Also, you would have noticed that there are 7 resources, in total, for this cost plan.

Risks as Part of the .PLAN file

This plan is somewhat different compared to the other sample plans available. This is because the risks are added as part of this cost plan. 

The risks have probabilities associated, along with modelling numbers. This is because only risk can have uncertainties as they are in the future and they are uncertain. Activities are planned and will be executed. But they do have uncertainties and hence the modelling.

The risks associated with this cost plan along with the probabilities are shown in the below figure. 

As shown above three risks are directly plan of the plan, not the risk register! There are:

• Material supply problems with 10% chance.
• Key personal availability with 25% chance.
• Design complexity underestimated with 20% chance.

In addition, each of these risks has minimum, most likely and maximum fixed cost. 

Running the Cost Analysis

Next, with this available plan (I’ve made some changes), we will run the risk analysis with respect to cost. This can be done by going to Risk menu > Run Risk Analysis … option. We will use the default parameters while going through analysis and will use the Monte Carlo simulation.

Post analysis, the Latin-Hypercube simulation (a modified version of Monte Carlo), we have the following representation.  

Analyzing the above report, one can say the following:

• The chance of meeting the estimated planned budget of $19.123 is hardly 11%.
• To have a 50% chance the budget has to go up and it has to be $19,679 M. In order to have 100% chance, the budget has to be $22, 249 M.
• Do note that the risks are included in the analysis and they are also impacting the final cost.

Conclusion

As we just learned, any kind of O&G project can be used for risk analysis using the Primavera Risk Analysis software tool. This is a special and advanced project with only the cost aspects. For duration too, the PRA software can be used.

You need not have any apprehension about it. If you are keen to learn detailed and end-to-end risk management with a software tool, then Practical RMP course is the right fit for you.

References

[1] Online Course: Practical RMP with Primavera Risk Analysis, by Satya Narayan Dash. 

[2] eBook: I Want To Be A RMP, 2nd Edition (Updated), by Satya Narayan Dash.

Leading Indicators and Lagging Indicators in Project Management

For the first time, in the PMBOK® Guide 7th edition, both leading and lagging indicators are introduced as Key Performance Indicators (KPI) for a project. Such indicators are applicable in all aspects of management – project, program, portfolio or risk management. It’s also applicable in Agile management.

Let’s understand them in simplest possible terms. The content of this article has been taken from RMP Live Lessons – Guaranteed Pass.

Indicators

I’ll define an indicator as follows:

“An indicator is something (a result, an event, a statistic) that indicates or signals.”

For example, if you are finding a number of bugs in your team’s deliverables, it indicates a quality problem. Based on it, you can take some actions such as having a more robust definition of done (DoD). 

Taking another example related to our personal lives, if you see a cloudy sky, it indicates that rain may happen next. Based on it, you may choose to take some actions such as taking an umbrella or searching for your raincoat.

The first result (high number of bugs) is a lagging indicator. This is because you came to know about it after the bugs occurred. But the second one is a leading indicator for rain. Because before the event occurred (rain), you came to the possibility of the event happening. 

Now that I’ve introduced two more terms – leading and lagging indicators – let’s understand them in detail. 

Leading Indicators

I’ll slightly change the definition provided by the Project Management Institute (PMI®) and will define it as:

“A leading indicator is a measurable data that helps to anticipate (predict) changes or trends in a project.”

Simply put, a leading indicator is about the future or it indicates the future. 

Some of the examples in management can be the followings:

• Lack of a risk management processes
• Stakeholders who are not available or engaged
• Poorly defined project success criteria
• Size of the project (quantifiable)
• Complexity of the project
• Number of items in progress after taken from the Backlog (quantifiable)

Considering the last example of too many in-progress items indicate a bottleneck in flow of work, or too complex work being taken-up. 

Lagging Indicators

Here too, PMI provides a good definition, but I'll modify a little:

“A lagging indicator is a measurable data that measures deliverables or events in a project.”

Simply put, a lagging indicator is about the past or it gives information about the past. 

Examples of lagging indicators can be:

• Number of deliverables completed (quantifiable)
• Schedule variance (quantifiable)
• Cost variance (quantifiable)
• Amount of resources consumed (quantifiable)

Taking the first example, one can say that if you are completing a good number of deliverables, then the project is progressing well. 

Next, I’m going to relate leading and lagging indicators with preventive and corrective actions, which you have to know as an aspiring PMP, PgMP, or RMP. 

Leading Indicators and Preventive Actions

As defined by PMI:

A preventive action is an intentional activity that ensures the future performance of the project work is aligned with the project management plan. 

For projects in an Agile environment, it'll be your product backlog with the product goal. In other words, the actions should be aligned with the product goal (or release goal or Sprint goal). 

Leading indicators can lead to preventive actions. With it, before the event or condition happens, you can take actions. For example, considering our second example of rain, before the rain event happens, you can take actions such as taking an umbrella.

Lagging Indicators and Corrective Actions

As per PMI: 

A corrective action is an intentional activity that realigns the performance of the project work with the project management plan. 

For projects executed with Agile frameworks, you will be taking actions that realigns with the product goal, release goal or Sprint goal.

Lagging indicators can result in corrective actions. For example, schedule variance is a lagging indicator. If very high variance, you can take actions with techniques such as fast tracking or crashing to improve. 

Comparison – Leading and Lagging Indicators

The comparision with both the differences and commanalities between leading and lagging indicators are shown in the table below.

Both these indicators are part of the Measurement Performance Domain (PD) of the PMBOK Guide, 7th edition. Because these indicators are primarily about measurement. The PMBOK guide prudently notes and I quote verbatim:

“In and of themselves, KPIs are simply measures that have no real use unless and until they are used. Discussing leading and lagging indicators and identifying areas for improvement, as appropriate, can have a positive impact on performance.” 

Indeed, measurements should be used. In my view, as a management professional and leader, you should measure (and use) both leading and lagging indicators. In fact, I'd say it's a best practice to use both in your projects.

References

[1] Project Management Body of Knowledge (PMBOK) Guide, 7th edition, by Project Management Institute

[2] RMP Live Lessons - Guaranteed Pass or Your Money Back, by Satya Narayan Dash 

[3] Article - PMBOK 7th Edition: Principles, Performance Domains and Artifacts – How Do They Plug and Play Together? (Part - 1)

[4] Article - PMBOK 7th Edition: Principles, Performance Domains and Artifacts – How Do They Plug and Play Together? (Part - 2)

Risk Breakdown Structure and Work Breakdown Structure – A Combined Way!

The Risk Breakdown Structure (RBS) is mostly used in Risk Management, whereas the Work Breakdown Structure (WBS) is in Scope Management. But then they can be combined to provide you better value from both the breakdown structures. 

In an earlier article, I noted the following:

"RBS can be used in combination with WBS to identify potential sources of risk. For example, the XYZ work package of WBS can be technical, environmental and political risk categories."

In my interactions with management practitioners, when I inform them, surprised looks come-up with certain questions: 

• How can RBS be used with a WBS?
• What are the advantages in having a combined structure and analysis?

In this article, we will explore just that!

Let’s start with a sample WBS.

A Sample Work Breakdown Structure (WBS)

I’ll reuse another WBS from one of my previous articles. This is depicted below. I’ve modified the WBS from the linked article a bit. 

As shown above, it’s only up-to Level 2 (L2). The reason is that I’m not going to identify the risks at the lowest level, but at a higher level. This way, I can refine more as I build the final-cut of RBS. This will be based on the areas identified in the WBS. 

Also, you’d have noticed that I’ve added another level (L0), which is the overall “Book Project”. Interpreting the above figure, you can say:

• At Level – 0, we have the Book Project. I’ve added L0 so that the WBS is synchronized in its structure with the RBS.
• At Level – 1, we have, Book – Risk Management. 
• At Level – 2, we have Manuscript, Write Book, Edit Book, Publish Book.

Next, let’s take a look at the sample RBS.

A Sample Risk Breakdown Structure (RBS)

For the sample RBS, I’ll use it from my previous article (with modifications for the book) as well and I’ll keep the structure at a higher-level (L2).  

As shown above:

• The Book Project is at the highest level, which is Level - 0 of the RBS.
• Under it, at Level – 1 of the RBS, there is Book – Risk Management. 
• Next, at Level – 2 of the RBS, we have multiple risks such as Writer’s Risk (e.g., writer’s block), Hosting Risk (e.g., online hosting problems), Editing Risk (e.g., wrong interpretation of meaning), Publishing Risk (e.g., publisher being unavailable). 

Finally, we are going to combine the RBS with the WBS, which will help us in identification of risks.

Combined RBS and WBS

While combining, I’ll keep the WBS in the X-axis (horizontal) and the RBS in the Y-axis (vertical).  

Let’s understand and interpret the above figure:

• The risks are identified by considering the L2 of RBS and L2 of WBS.
• In the lowest row of the table shown with tick marks, the “Writer’s Risk” category of the RBS is associated with “Write Book” and “Edit Book” of the WBS. It means one can have a cluster of writer’s risks while going for the deliverables of Write Book and Edit Book. 
• Taking another example, in the topmost row of the table with tick marks, the “Publishing Risk” category is associated with “Manuscript” and “Publish Book” deliverables.  

Hence, considering the second bullet point above, one can say that a number of writer's risks (from the RBS) can be found while writing the book and editing the book (from the WBS).  Similarly, one can say a number of publishing risks can be found during the development of manuscript and of course, while publishing the book. 

Conclusion

When you combine the RBS and analyze the risk categories with the WBS, you can find the areas when the project is most likely to exhibit the most risk. 

As demonstrated in the final figure, one can quickly find the areas of the project, where you can find various categories of risk. In turn, it helps to build a more refined Risk Register.

References:

[1] Practical RMP with Primavera Risk Analysis, by Satya Narayan Dash.

[2] RMP Live Lessons, Guaranteed Pass or Your Money Back, Satya Narayan Dash.

[3] RMP 30/40 Contact Hours Online, Satya Narayan Dash.

[4] PMP Live Lessons, Guaranteed Pass or Your Money Back, Satya Narayan Dash.

[5] PMP 35 Contact Hours Online, Satya Narayan Dash.

A Practical Risk Breakdown Structure with MS Project and Primavera Risk Analysis (PRA)

In the earlier article, I wrote about various Breakdown Structures and specifically, the Risk Breakdown Structure (RBS). As noted in the previous article, breakdown structures are progressively decomposed into greater levels of detail.

But then the following questions come-up?

• How does that happen practically?
• How does the RBS level (Level n) be associated with the identified risks?
• What is its usage as you proceed with risk management?

To know these, one needs to know how an RBS is prepared in a practical manner with a hands-on software tool. In this article, I'm going to use the Primavera Risk Analysis (PRA) software. 

The content of this article has been taken from this course: Practical RMP with Primavera Risk Analysis. 

Now, let’s see the various steps and its role in risk management in a hands-on manner. 

Step – 1: Create the Plan

I’ve a simple plan created with MS Project (MSP), which is shown below. It has a couple of work packages and associated activities.  

Next, I’ll take this plan and import it into the Primavera Risk Analysis (PRA) software. After the import, it’ll look like the following one. 

As you can see, this plan in the PRA is an exact reflection of the previous plan in MSP.

Step – 2: Build the First-Cut of RBS

Now for the above plan, we are going to create the first-cut risk breakdown structure (RBS). 

To get to the Risk Breakdown Structure in the PRA software, first you have to open the Risk Register by going to PRA Menu and using Risk > Register… command. This will open the default risk register without any entry. 

From there, execute the Edit > Risk Breakdown Structure … command.  

As shown above, at this stage, the risk register doesn’t have any entry at all. Stay with me! We are going to add risk (s) and associate them,

Now, with the above command the RBS first view will come-up. 

As shown, the current RBS:

• Four entries – Organizational, Commercial, Environmental and Technical.
• Each of this entry is at Level – 1. One can add as many entries as one wants. We will see that shortly. 
• There are commands on the right such as Insert (for insertion of new levels), Edit (to edit the names), and Delete (to delete any level).
• Below the delete command there are left, right, top and bottom arrow marks, which are used to change the levels and indentation.  

Step – 3: Add Risks into the Risk Register

Our next step will be to add a risk into the risk register. Click the OK button in the previous screen to close the above RBS window and go back to the risk register. 

To add a risk, simply type the risk in the “Title” part/column of the risk register. The risk will be populated with ID, T/O (threat or opportunity), Probability scale and Impact scales such as schedule, cost, performance, score etc.  

As shown above:

• We have Risk ID – 001 and it’s a threat or negative risk.
• The default probability value is Very High (VH). 
• The default impact scales are VH, VH and VH for schedule, cost and performance, respectively.
• The scope has been calculated to be 72 internally with the help of PRA Risk Matrix. 

The most important one to note for this article and at this stage is this:

• RBS is shown in the bottom right half of the above view.
• There is no level for the RBS. In other words, the risk is not associated with any RBS level.

Step – 4: Build A Refined RBS

Next, we will go back to the RBS and add a few more levels, e.g., Scope. I’m taking scope, because in the previous step we just added a scope related risk.

Do note that:

• RBS Level – 0 is the project level.
• RBS Level – 1 is Scope, Political, Environmental etc.
• RBS Level – 2 will be another one. For our case, we will take two: Scope definition and Scope Change.

You can go to any level you want. However, do ensure that it’s reasonable and not too fine-grained. Many risk management practitioners get into very low levels, which can pose problems later.

After adding the levels, the refined RBS will look as shown below. This is again drawn with the PRA software.

I’ve used the Insert, Edit, Delete and arrow commands to create this structure. For example, to move the Technical (L1 of RBS), I’ve used the up-arrow mark. To add a new level of Scope (L2), I’ve used the Insert command. To add another level of Scope definition (L3), I’ve used the Insert command and right arrow mark. 

You can click on the “OK” command to close the RBS and go back to the risk register.

Step – 5: Associate the Risk with the RBS

Next, we are going to associate the risk with Scope change (L3) of the RBS because the risk “Scope related risk” is due to the rapid scope change.

To associate with a risk, use the “…” command next to the RBS text box. This is shown below.

As you select the “…” command, the Select Risk Breakdown dialog box will be opened-up. Choose the Scope change (L2) and click on the “OK” command.  

Next, the risk in the register will be associated with this level of RBS. 

As shown in the above figure:

• Risk ID – 001 of scope related risk is now associated with an RBS element.
• The element is “Technical.Scope.Scope change”.
• Technical is at L1, Scope is at L2 and Scope change is at L3.

That’s it! If you could follow these simple steps, a practical RBS can be created. And you can associate all the risks of the register with various levels of RBS.

Conclusion 

As I just demonstrated, the risk breakdown structure can be a key artifact used in Risk Management used in conjunction with the risk register. Like WBS is important to know the required deliverables, the RBS can be crucial, if you're really doing risk management.  

As WBS can be used as a communication tool, the RBS can also be used as a communication tool. The risk register with various levels of information can be exported to an excel sheet. This can be communicated with the stakeholders.

References:

[1] Course – Practical RMP with Primavera Risk Analysis, by Satya Narayan Dash.

[2] Course – RMP Live Lessons, Guaranteed Pass or Your Money Back, Satya Narayan Dash.

[3] Course – RMP 30/40 Contact Hours Online, Satya Narayan Dash.

Fundamentals of Risk Breakdown Structure (RBS)

 

A breakdown structure is what the name tells. It's basically a hierarchical decomposition and each lower level gives more details or information. One of the best-known breakdown structures is the Work Breakdown Structure (WBS). In this article, however, we will know more on the Risk Breakdown Structure (RBS). The Standard for Risk Management and the PMBOK 6th edition use RBS as a tool, whereas in the PMBOK 7th edition, it's an artifact and kept under Model-Methods-Artifacts (MMAs). 

RBS is not a much-understood concept, but very useful in real-world risk management. But before you proceed further, I'll suggest that you read this article on WBS, to understand breakdown structure more.

Other Breakdown Structures in Management

Other than Risk Breakdown Structure, here are some of the breakdown structures that you need to know in Project Management, Program Management and  Agile management. This will be useful and helpful in your professional work.

• Product Breakdown Structure (RBS): A hierarchical chart showing a product's components and deliverables. It's mainly used in Scope Management.
• Organizational Breakdown Structure (OBS): A hierarchical chart showing the project organization. It’s mainly used in Resource Management. 
• Resource Breakdown Structure (ReBS): A hierarchical chart showing the resources by category and type. Examples of categories can be personnel, material, equipment etc. Examples of type can be role 1 (engineer), role 2 (plumber), which can be further broken down into levels (Level 1 engineer). It’s also mainly used in Resource Management.
• Story Breakdown Structure (SBS): A hierarchical chart showing the breaking down of epics into stories and finally into tasks. This is my term and I use it in an Agile context. You can learn more about it in this article on stories.

Initial Top Points 

I've used ReBS to distinguish between the Risk Breakdown Structure (RiBS). In this article, I'll use RBS acronym for risk breakdown structure. 

The Project Management Institute (PMI) gives a simple definition for the Risk Breakdown Structure (RBS):

"A hierarchical representation of potential sources of risk."

As it’s a representation of potential sources of risk, it’s widely used in risk identification, or specifically in the Identify Risks process. 

Following are the top points about RBS at this stage:

• Can be generic or specific. Generic ones are used across projects, whereas specific ones are developed for a specific project.
• Can be tailored, which is an extension of the previous point.
• Can be broken down to any level, from Level 0 to Level N.
• When broken down, each low level will give more information.

Levels in an RBS

As noted earlier, you breakdown into any levels while building an RBS. But you have to be careful. Don’t make it too fine-grained and hence, difficult to manage. 

Following are the levels in an RBS:

• Level – 0 (L0): This is the project level, just like the WBS. After all, the project itself will have all potential sources of risk. But do note, not all project management literature considers L1 to be the project level.
• Level – 1 (L1): Here we breakdown into the higher-level categorization of risks such as Technical, Political, Environmental, External, among others.
• Level – 2 (L2): The one level below L1 and it has more information with respect to one of the previous categories. For example, considering Technical, it can be broken down into Scope, Requirements, Technology.
• Level – 3 (L3): This is further refinement of the previous level. For example, consider Scope, it be “Scope definition”, “Scope change” etc. 

While breaking down, I’d generally suggest that you don’t go beyond L3, unless really needed.

Progressive Elaboration and Breaking of RBS

As is the used norm, a hierarchical chart is generally progressively elaborated. I hope you have read the previous linked article on WBS. I'll slightly change the definition of progressive elaboration in the context of RBS. 

"Progressive elaboration is the iterative process of increasing the level of detail in an RBS as more information is known about the project."

The definition is important, because building an RBS is not a one-time activity, but it’s developed and iterated over the project’s life cycle. If one finds more information and/or more categories of risks, then it should be added to the RBS.

In other words, during risk management strategy and planning, the first-cut of the RBS is available. However, if it's a multi-phase project or as you progress with respect to the project, the RBS will be updated. 

An Example

To understand more clearly, let’s take an example. A sample RBS (reference taken from PMI) is shown below.

Interpreting the above figure, one can say the followings:

• Level – 0: The highest level and it’s the level of the project.
• Level – 1: You have categories such as Technical, Management, Commercial etc. 
• Level – 2: A further breakdown of each at Level – 1. For example, technical has been broken down into 'Scope', 'Requirement'.
• Level – 3: L2 is further broken down with more information. For example, scope has been broken down to ‘Scope definition’, ‘Scope change’.

Another important point to note in RBS is that every element in the RBS is associated with the RBS Identifier (RBS ID), which uniquely identifies the elements. For example:

• 1. Technical Risk
• 1.1 Scope 
• 1.1.1 Scope definition
• 1.1.2 Scope change
• 1.2 Requirements 
• 1.2.1 Requirement definition
• 1.2.2 Requirement change
• 2. Envionmental Risk
• 2.1 Market
• 2.2 Industry changes

This is very much like the WBS IDs, where each element in the WBS is uniquely identified with the IDs such as 1.1, 1.2.2.

By this time, you would have realized that an RBS can not only be represented in a chart, but it can also be tree structure, tabular structure. The one shown above with RBS IDs is a tree structure, whereas the table shown before, depicts the RBS in a tabular structure.  

Final Words – Usage of RBS

Finally, as we reach this basic article, some more final key points with respect to the Risk Breakdown Structure. These are important to know!

• The lowest level of RBS (available risk categories) can be used as a prompt-list to identify individual project risks. 
• Along with this prompt-list, you can apply the brainstorming to get more information with respect to risks.
• RBS can be used in combination with WBS to identify potential sources of risk. For example, the XYZ work package of WBS can be technical, environmental and political risk categories.
• One can combine the results of qualitative risk analysis (specifically the Perform QLRA process) with the project’s RBS to show clusters of risks, which are coming from specific sources. 

I hope this article gives a foundational understanding on RBS and it helps in your work and preparing for the Risk Management Professional (RMP) Exam.

References:

[1] Course – Practical RMP with Primavera Risk Analysis, by Satya Narayan Dash.

[2] Course – RMP Live Lessons, Guaranteed Pass or Your Money Back, Satya Narayan Dash.

[3] Course – RMP 30/40 Contact Hours Online, Satya Narayan Dash.

20 NEW PMI-RMP Multi-Response Free Questions and Answers (Part - 2)

 

This is in continuation of the earlier series of questions for the mutlti-response or multi-answer questions for the PMI-RMP® examination. I call them multi-response, multi-choice quesitons.

I'd strongly suggest that you take both the parts together when you try to attempt the questions. That way you will get a feel of questions and how to answer them. Do note that these are not verbatim  questions from PMI-RMP exam, however, these questions covers the areas needed for the exam. These questions are taken from the following courses and book:

• RMP Live Lessons – Guaranteed Pass or Your Money Back
• RMP 30/40 Contact Hours – Full Moneyback Guarantee
• I Want To Be A RMP, 2nd Edition, 2022 updated with latest exam pattern 

Again do note that the PMBOK 7th edition is a reference for the new RMP exam. It's explicitly listed in the exam content outline (RMP-ECO). 

The RMP Live Lessons course also comes with a dedicated  full-length question for this purpose (PMBOK7 and ECO).

In this part, we will have final 10 multi-answer/response questions. I hope you are able to do most of the questions on your own! If not, do send a mail as noted below.

[This series - Part - 1]

Subscribe to the site (top-right corner) for fresh updates.

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Question – 11: For a project, the risk manager has all the planning related work, implementing the risk responses and currently monitoring the risks. For certain risks, while monitoring, the plan is to trigger a response based on analysis. Which of the following can be used (choose two)?

A. Affinity diagrams.

B. Contingency planning.

C. Variance analysis.

D. Residual impact analysis.

E. Trend analysis.

Question – 12: Which of the following are not correct about reserve analysis (choose two)?

A. Informs the amount of reserves remaining to the amount of risk remaining at any time in the project.

B. Use in both Perform Quantitative Risk Analysis and Monitor Risks process.

C. Can be plotted with a cause-and-effect diagram.

D. Burndown charts can be used to represent the reserve remaining.

E. Tells if the remaining reserve is adequate.

Question – 13: For a project, a number of risk related activities, but conditions ones, are added with changes to the project schedule. These have been approved and integrated, which in result in updates to (choose two):

A. Project schedule.

B. Project schedule management plan.

C. Project management plan.

D. Project schedule baseline.

E. Project resource management.

Question – 14: A planning session is ongoing in order to build a common understanding of the risk approach between stakeholders and to gain agreement for managing risks in a project, which will be part of the portfolio. The output of this meeting can have which of the following (choose two):

A. Introduction, Portfolio description, Stakeholder risk appetites.

B. Identified risks, Risk owners, Risk Response Owners.

C. Project description, Criteria for success, Thresholds and corresponding definitions.

D. Communications management plan, Risk breakdown structure, Contingency plans.

E. Risk management organization, Roles, responsibilities, and authority, Risk management techniques and guidelines for use.

Question – 15: Risk identification is about all of the following, except (choose two):

A. Develop a comprehensive list of all known uncertainties that could project objectives.

B. Use various tools and techniques such as variance analysis and trend analysis to identify new risks.

C. Write the risk statements in a three-part statement for clarity.

D. Use matrix method-based techniques such as analytical hierarchical process (AHP) to identify risks.

E. Remove biases and an array of human behavior patterns stand in the way of identifying unknown risks.

Question – 16: An example of unknown-known can be all of the followings, but (choose two):

A. A known fact.

B. A hidden assumption.

C. A hidden fact.

D. An unknowable.

E. An ignored assumption.

Question – 17: Delphi technique is one of the core techniques used to identify various uncertainties in a project and hence, associated risks. However, one of the key stakeholders opposes and outlines a number of reasons about its drawbacks. Why can this stakeholder be right (choose two)?

A. Limited to technical risks.

B. Iterative and hence gets unnecessarily refined.

C. Removes sources of bias.

D. Dependent on actual expertise of experts.

E. Can't be used for reserve estimation.

Question – 18: A project is getting closed. The risk manager and team members have tried to manage the risks to a large extent possible, but still some of the risks remained. As the project draws to a closure, what should be done with these risks, except (choose two)?

A. Include a summary of any risks or issues encountered on the project and how they were addressed.

B. Check the risk register and close all the risk before closing the phase.

C. Move the content of the risk register into the lessons learned register.

D. Hand-over the remaining risks into the next phase of the project.

E. Check the risk report in order to see the status of high-priority risks.

Question – 19: For a multi-geographical project under a satellite program, a project manager is currently collecting the performance information. In addition to it, which of the following can be done, except (choose two)?

A. Checking the status of the risks that have already been identified.

B. Evaluating whether or not the impact can be contained within the limits of the project budget.

C. Verifying whether any known risk has not occurred or is not about to occur.

D. Monitoring the status of all actions implemented to respond to the detection or occurrence of a risk.

E. Adding additional activities or work packages to update the project’s baselines or product backlog.

Question – 20: For a project, the risk owner has been monitoring the actions to determine the effectiveness and to identify if any secondary risks have arisen. The risk action owners while informing the status of response actions say that the undertaken actions are closed. What should the risk owner do next (choose two)?

A. Check if the risk has been effectively dealt with.

B. Inform the project manager about it and close the risk.

C. Determine if any additional actions need to be planned and implemented.

D. Keep the risk in the register and manage the risk through subsequent risk management processes.

E. Immediately perform an audit of this risk to determine the effectiveness of response.

[This series - Part - 1]

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The question set is available in the embedded document below. The answers are also part of this document. You can scroll to see the content. 

For all answers, subscribe to this site and send a mail (from your GMail id) to managementyogi@gmail.com.

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20 NEW PMI-RMP Multi-Response Free Questions and Answers (Part - 1)

The Risk Management Professional (RMP®) exam from PMI® has various types of questions, including the multi-response questions. Indeed, if you are appearing for the latest RMP exam in 2024 and beyond, then you will face both multi-choice and multi-response questions. There is a subtle difference between the two.

Multi-choice questions: There will be four radio-button choices. ONLY one of the choices will be correct. I call it single-response, multi-choice question. These questions are relatively not that difficult. But considering PMI, the standard will be high. 

Multi-response questions: There will be usually five choices with check-boxes on the left, where you can select the right answers. In this case, there will be more than one correct answer. I call these multi-response, multi-choice questions. These are also called mutli-answer questions. These questions, compared to multi-choice questions, will be relatively difficult. 

These questions are taken from the following courses and book:

• RMP Live Lessons – Guaranteed Pass or Your Money Back
• RMP 30/40 Contact Hours – Full Moneyback Guarantee
• I Want To Be A RMP, 2nd Edition, 2022 updated with latest exam pattern 

To answer these questions, you need to have:

• Understanding of the Standard for Risk Management in Portfolios, Programs and Project. This is the main reference for the RMP exam.
• Understanding on the concepts of uncertainties, complexties, ambiguities and risks from both PMBOK Guide 7th edition and PMBOK 6th edition. Yes, PMBOK 7th edition is an explicit reference for the latest RMP exam!
• Ability to apply your understanding in the real-world in a varieties of situations and scenarios.
• Good understanding of the PMI-RMP exam content outline (ECO), the latest one released in March/April 2022.

In this part, we will have 10 such multi-answer/response (or multi-response, multi-choice) questions. 

You will be seeing such questions for the first time. As noted earlier, RMP exam takers are already facing such questions. 

I hope you enjoy doing the questions and it helps in your PMI-RMP exam.

[This series - Part - 2]

Subscribe to the site (top-right corner) for fresh updates. 

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Question – 1: One of the principles of risk management is to foster a culture to embrace risk management. Such a culture: (choose two)

A. Identifies threats rather than ignoring them.

B. Identifies opportunities rather than ignoring them.

C. Identifies opportunities by cultivating a positive mindset within an organization.

D. Identifies both threats and opportunities by allocating the right resources.

E. Focuses on most impactful risks first.

Question – 2: Which of the following are not correct about risk attitude (choose two)?

A. Driven by perception and evidenced by observable behavior.

B. Must range from risk seeking to risk averse.

C. Individuals will have inconsistent attitudes towards risks.

D. Not always stable or homogenous.

E. It's the degree to which an individual accepts risks in anticipation of reward.

Question – 3: A risk manager and team members are identifying various sources of uncertainties at the individual project task level and also overall project level. While doing so, they are currently focusing on the quantitative assessment of various project constraints such as cost, schedule, scope, quality among others. Which of the following cannot be inputs for this purpose (choose two)?

A. Cost estimates.

B. Duration estimates.

C. Requirement estimates.

D. Resource estimates.

E. Resource requirements.

Question – 4: Risk management planning process is not only important from the process perspective, but also strategy perspectives. Which of the following are not the purposes of this process (choose two)?

A. Gain a better understanding of individual risks. 

B. Have a numerical estimate of the overall effect of risk on the objectives.

C. Develop the overall risk management strategy.

D. Decide how the risk management processes will be executed. 

E. Integrate risk management with all other activities.

Question – 5: Considering team members are new to the project and risk management is quite new, which of the following are the key success factors for risk identification (choose two)?

A. Risks linked to objectives.

B. Agreed upon definition of risk terms.

C. Complete risk statement.

D. Appropriate risk data model. 

E. Available resources, budget and schedule for responses.

Question – 6: Considering risk owner and risk action owner, which are not correct? (choose two)

A. Risk owner is responsible for monitoring the risk.

B. Risk owner is responsible for selecting and implementing an appropriate risk response strategy.

C. Risk action owner reports the risk owner about the status of the risk response actions.

D. Risk action owner is responsible for finding out the effectiveness of a response.

E. Risk action owner owns the response actions, whereas risk response owner owns the response.

Question – 7: A project has been following the project management body of knowledge (PMBOK) guide's process group model of initiating to closing to manage a project, of which risk management is an integral part. Considering the planning process group of the five process groups, which of the following are considered?

A. Understanding of high-level risks that might impact project objectives.

B. Selection of overall risk management approach for the project.

C. Risk management integration with quality management and execution of stakeholder engagement strategies.

D. Risk management being part of every process in the planning process group.

E. Handing over the remaining known risks prior to closure of the project.

Question – 8: A risk manager is evaluating the effectiveness of risk management processes as documented in the risk management plan. The purposes of the audit can be (choose two):

A. Risk management rules are being carried out as specified.

B. Residual risks response planning is properly taken. 

C. Risk management strategy is iterative and integrative.

D. Risk management related lessons are documented properly. 

E. Risk management rules are adequate for monitoring and controlling the work.

Question – 9: The risk breakdown structure (RBS) is a hierarchical framework of potential sources of risk and used in risk identification. RBS can be used for all of the following situations, except (choose two):

A. Can be used in association with brainstorming.

B. Ensures coverage of all types of risk. 

C. Lowest level of RBS is known as the risk package.

D. Tests for blind spots or emissions.

E. Used for evaluating current risks as well as identifying new risks.

Question – 10: In a meeting for risk identification, the risk manager wants to allow all participants to speak their mind and contribute to the discussion. This is to identify as many risks as possible and to stimulate creativity. Which of the following tools and/techniques will help the risk manager the most (choose two)?

A. Brainstorming.

B. Checklist.

C. Prompt list.

D. Document analysis.

E. Delphi technique.

[This series - Part - 2]

Subscribe to the site (top-right corner) for fresh updates. 

*********

The question set is available in the embedded document below. The answers are also part of this document. You can scroll to see the content. 

For all answers, subscribe to this site and send a mail (from your GMail id) to managementyogi@gmail.com.

RMP Live Lessons - Guaranteed Pass:

• RMP Live Lessons Course - Guaranteed Pass or Your Money Back

RMP 30/40 Contact Hours Online:

• RMP 30/40 Contact Hours Online - Full Moneyabacl Guarantee

Book for RMP Exam:

• New Book for RMP Exam Prep: I Want To Be A RMP, 2nd Edition