MGMT7020 Chap.4 Initiation, Prioritisation and Project Risk
Initiation, Prioritisation and Project Risk
Priorities before risks
A risk only matters in relation to what the project is trying to achieve, so this chapter starts with prioritised goals agreed at initiation, then works through the identify, analyse and register cycle used in the Week 3 seminar.
From risk to uncertainty
It shows how to write usable register entries, plots four risks on a probability and impact grid, and then sets out Ward and Chapman's argument for uncertainty management, including their five areas of uncertainty and six Ws.
What a strong answer shows
A strong answer on risk does more than list threats.
It ties each risk to an agreed priority, gives reasons for its ratings, chooses a response that fits the cost, names an owner, and notes at least one opportunity.
It also recognises the limits of the matrix and can explain, using Ward and Chapman, why some uncertainties about objectives and relationships between parties will never appear on an event-based register.
Common errors on this topic
Students often list risks as single words, rate them without reasons, and forget opportunities.
Another frequent slip is assigning every risk to the project manager, when some uncertainties, such as objectives or the relationship between funder and contractor, sit with the project owner or higher in the organisation.
What this chapter covers
- 01
Prioritised goals at initiation
- 02
Identify, analyse and register
- 03
Writing a usable risk entry
- 04
Avoidance, transference, mitigation and acceptance
- 05
Probability and impact matrices
- 06
Five areas of uncertainty
- 07
The six Ws
Worked example · free
Turn a vague risk list into register entries
- 2Vendor: the supplier may deliver late because of a component shortage, delaying the start-of-term launch; mitigate by staging delivery and agreeing penalties; owner, procurement lead.
- 2Staff: teachers may not use the laptops in class because of limited training time, so learning benefits are not realised; mitigate with in-class coaching; owner, deputy principal.
Key terms
- Risk Register
- The record of identified risks with their ratings, responses, owners and review dates.
- Probability Impact Matrix
- A grid that rates each risk by likelihood and by effect to show its priority.
- Risk Transference
- A response that shifts the consequence of a risk to another party, often by contract.
- Variability
- Spread in possible values of cost, duration or quality around an estimate.
- Ambiguity
- Lack of clarity about assumptions, parties, objectives or the basis of an estimate.
Initiation, Prioritisation and Project Risk FAQ
What are the three steps of risk management in the Week 3 seminar?
Identify the risks to your project, analyse them by considering probability and impact, and register them with a planned response. The register is reviewed as the project moves, because uncertainty changes shape from conception to delivery.
Why do Ward and Chapman prefer the word uncertainty to risk?
They argue risk pulls attention towards threats and discrete events. Starting from uncertainty covers opportunities as well as threats, and includes ambiguity about objectives, estimates and relationships between parties that an event list misses.
Is a probability and impact matrix enough?
It is a quick sorting tool, but the readings warn it treats risks only as threats and over-simplifies. Record the reasoning behind each rating, show opportunities separately and refine where the uncertainty proves to matter.
What are the four risk responses named in the PMI guide?
Avoidance, transference, mitigation and acceptance. Avoidance changes the plan so the risk cannot arise, transference shifts the consequence to another party, mitigation reduces probability or impact, and acceptance lives with the risk, ideally with a contingency ready.
What are Ward and Chapman's five areas of uncertainty?
Variability in estimates, the basis of estimates, design and logistics, objectives and priorities, and the fundamental relationships between project parties. Each area is more fundamental than the one before, and an event-based register mainly captures the first.
How should opportunities be handled in a risk register?
Record them separately with their own responses, such as exploiting a cheaper supplier or an early finish. Ward and Chapman argue threats and opportunities are rarely independent, so reducing one without considering the other can lose value.
Exam move
Learn the five areas of uncertainty in order from shallow to fundamental, and practise rewriting register entries in uncertainty language. For each risk you write, name the priority it threatens. When you rate a risk, write one line of evidence for the probability and one for the impact.
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