8. Risk Response
Risk response simply denotes the procedures implemented or steps taken upon the discovery of unacceptably high degree of exposure to risks. These are the measures taken to deal with the risks. Risk response strategies are based on risk tolerance (Egeland 2009). They include avoidance, acceptance, transfer, and mitigation (Egeland 2009; Adeak 2010).
Acceptance strategy is employed when the risk severity is lower than the risk tolerance level. Nothing is done until the risk occurs. After the occurrence, the problem is fixed and normalcy returns. Most project risks falls in this category. These are the insignificant risks that cost less to fix after their occurrence than would cost to investigate and plan for them (Egeland 2009; Adeak 2010). Acceptance can either be passive or active.
The transfer strategy transfers the risk responsibility to another person outside the project. This does not stop the risk from occurring; only the responsibility is transferred. Avoidance strategy is employed to stop the risk from occurring. The possibility of the risk is completely eliminated.
9. Links to Project Processes
Every project process defines the procedures taken to manage the elements of the project. Project management processes include time, cost, quality, change, risk, issue, tender, and procurement, acceptance, and communication management processes. The risk management process would enable the project manager to identify, review, mitigate, and monitor the project risks. Project success depends on how effectively the risk management processes are linked up. Risk management process should have a clear purpose, well-defined activities, reliable inputs, and value added outputs (DeLoach 2012).
The process begins with the identification and prioritization of the risks. The risks are then traced to their root causes or drivers. Once the causes are known, it becomes much easier to design the metrics. This helps in deciding the appropriate risk response. All these processes are linked up, and the overall success depends on how well each process is executed.
Works Cited
Adeak. Risk Management: What are Risk Response Strategies? 2010. Web. November 25, 2012.
DeLoach, J. Key Elements of the Risk Management Process. 2012. Web. November 25, 2012.
Egeland, B. Defining Risk Management – Part 6: Risk Response. 2009. Web. November 25, 2012.
