Homework - Risk and Decision Management
1) You are working program X. The total budget allocated to the program is $100 M and it is to be completed in 24 mo. range (R) and passenger capacity (C) are two key performance parameters with threshold requirements of 200 mi and 10 passengers respectively.
a. What metrics would you use to monitor cost risk?
b. What metrics would you use to monitor schedule risk?
c. What metrics would you use to monitor technical risk?
d. Range and Capacity are examples of what type of metrics?
e. Establish a set of criteria for determining whether a given cost, schedule, or technical consequence is high, medium, or low.
f. Establish a set of criteria for determining high, medium, and low likelihood.
2) Suppose that prior to the current program, your company developed a prototype system that had a range of 100 mi. and a capacity of 8 passengers.
a. Develop a TPM plan for each metric.
b. As the program progresses, how would you use these plans to determine the degree to which you are at risk of not achieving the program's requirements?
3) Continuing with problem 1, suppose you have performed an analysis of current technical trends and you determine there is 1) a 70% likelihood that the maximum range you will be able to obtain using your design approach is 150 mi., and 2) a 30% likelihood that the maximum passenger capacity you will be able to achieve is 9 passengers.
a. What is the risk associated with achieving each requirement?
b. What type of risks are these?
c. Construct a Risk Cube and show the location of each risk on the cube
d. What risk management process was used to determine the consequence and likelihood of each risk?
4) Give an example of a good decision you made. Why do you consider it a good decision rather than a lucky one?
5) Given an example of a bad decision you made. Why do you consider it a bad decision rather than an unlucky one?
6) What is YOUR definition of a "good decision?" What elements do YOU believe go into making a good decision? Since I am asking for YOUR thoughts, please do not quote MINE or other sources.
Some Other Potential Test Questions:
1) Risk
a. Define "Risk."
b. What two parameters are used establish the magnitude of a risk?
c. What are the three principal types/categories of risk?
d. Generally, into how many levels does one break consequence and likelihood (and thus risk)? Note there are two correct answers. You must provide both for full credit.
e. How does one determine whether a consequence is "high," "medium," or "low?"
f. What metric(s) is (are) used to measure cost consequence?
g. What metric(s) is (are) used to measure schedule consequence?
h. What metric(s) is (are) used to measure technical consequence?
i. How does one determine whether a likelihood is "high," "medium," or "low?"
j. What is a "Risk Cube?" Provide an example.
k. How does a "risk" differ from an "issue?"
2) Define "Opportunity." How is it related to Risk?
3) Risk Management:
a. Identify and briefly describe the four major components of the "Risk Management Process."
b. Which Risk Management Process is the principal focus of this course?
c. Identify and briefly describe the four principal approaches to Risk Handling.
d. What are the two major elements of Risk Control?
e. What are the key elements of a risk mitigation plan?
4) What are the relationships between Decision Management, Risk Management, Issue Management, Decision Analysis, and Risk Analysis?