TOPIC: Free CAPM® Exam Sample Question

Developing prototypes to clarify requirements is considered which type of strategy for planning risk responses?

A. Avoid
B. Transfer
C. Mitigate
D. Accept

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HINT: The purpose of developing prototypes is to reach a common understanding of the project requirements, thus reducing the probability of rework.

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Answer and Explanation:
The correct answer is C.

There are five response strategies to deal with individual risks in a project: escalate, avoid, transfer, mitigate, and accept. Of these strategies, mitigation reduces the probability and impact of a risk to the project. Prototypes are developed so that the sponsor or customer can review the prototype and confirm the team’s understanding of project requirements. The result is to mitigate the risk of rework caused by requirement misunderstanding. Thus, developing prototypes is considered risk mitigation.

Details for each option:

A. Avoid
Incorrect. ‘Avoid’ is a risk response strategy chosen to eliminate a threat, perhaps by changing part of the project management plan or adjusting project objectives or baselines so that a threat has zero impact on the success of the project. The purpose of developing prototypes is to reach a mutual understanding of the project requirements, which may mitigate but not entirely remove the risk of rework due to misunderstanding requirements.

B. Transfer
Incorrect. ‘Transfer’ is a strategy that shifts ownership of a threat so that a third party bears the impact of the risk, as in using insurance, performance bonds, warranties, or guarantees. Developing prototypes does not involve shifting ownership of a threat and thus is not an example of risk transference.

C. Mitigate
Correct. ‘Mitigate’ is a strategy to reduce the probability of occurrence or impact of a threat. When a project team misunderstands how the sponsor or customer sees the requirements, they may produce unacceptable deliverables that require rework. Developing prototypes allows the customer or sponsor to review an early stage of the work product, whereby their feedback may enhance the project team’s understanding of project requirements. This strategy reduces or mitigates the costs and delays of rework.

D. Accept
Incorrect. ’Accept’ is a strategy whereby the project team decides not to take any action unless the risk occurs. If you take an active approach to acceptance, you may allocate a contingency reserve in your budget, schedule, or resources but take no further action. If you take a passive approach to acceptance, you take no action to deal with the threat. On the contrary, developing prototypes is not an example of acceptance because the project team takes action well before the risk of rework has a high probability of occurring.

Reference: A Guide to the Project Management Body of Knowledge, (PMBOK^® Guide) – Sixth Edition, Project Management Institute Inc., 2017, Page(s) 442-443