--- title: "Risk response planning strategies" subject: "Project Engineering" chapter: 5 key: "semester_7/project_engineering:risk-response-planning-strategies" source: https://www.bctengineer.com/q/semester_7/project_engineering/risk-response-planning-strategies site: BCT Engineering --- # Risk response planning strategies Project Engineering · Chapter 5: Project Risk Analysis and Management - Asked in: 2080 Baisakh, 4 marks; 2076 Asoj, 4 marks; 2078 Bhadra, 6 marks (asked 3 times) - Video: [Risk Response Strategies in PMP Explained with Real-Life Examples](https://www.youtube.com/watch?v=wfUEXDjx2nE) — Amer Ali - Answer checked by Claude Opus 5.5 (high effort) on 2026-10-14 - Page: https://www.bctengineer.com/q/semester_7/project_engineering/risk-response-planning-strategies - Whole chapter: https://www.bctengineer.com/md/semester_7/project_engineering/chapter-5 ## Question What are the strategies for risk response planning? Why is risk response planning important in a project? What are the response strategies for negative risk? ## Short answer Risk response planning develops options and actions to reduce threats and enhance opportunities, assigning an owner and budget. It is important because it gives planned action before risks occur, reduces probability and impact, sets responsibility, and protects cost, schedule and quality. Strategies for negative risks are avoid, transfer, mitigate and accept. ## Answer #### Risk response planning Risk response planning is the process of developing options and actions to improve opportunities and reduce threats to the project objectives, after the risks have been identified and analysed. It assigns an owner to each response and puts its cost and time into the plan. #### Strategies for risk response planning - **For negative risks (threats):** avoid, transfer, mitigate (reduce), accept. - **For positive risks (opportunities):** exploit, share, enhance, accept. - **Contingent response:** a plan used only if a trigger event occurs. #### Why it is important 1. It gives a planned action before the risk happens, so the loss is smaller. 2. It reduces the probability and impact of threats and increases opportunities. 3. It sets responsibility (risk owner), time and budget (contingency reserve). 4. It protects the cost, schedule and quality objectives. 5. It helps decisions on insurance, contract type and reserves. 6. It gives confidence to the client, lenders and the team. #### Response strategies for negative risks | Strategy | Meaning | Example | |---|---|---| | **Avoid** | Change the plan so the risk cannot occur or its impact is removed | Shift a bridge site away from an unstable slope; change to a proven design | | **Transfer** | Shift the impact and ownership of the risk to a third party (the risk is not removed) | Insurance (CAR policy), performance bond, fixed-price contract, subcontract | | **Mitigate (reduce)** | Reduce the probability and/or the impact to an acceptable level | Extra soil tests, early procurement, quality control, training, safety measures | | **Accept** | Do nothing now (passive) or keep a contingency reserve (active) | A minor price change accepted with a 5% contingency | The best strategy is chosen by comparing the cost of the response with the expected loss. High-probability, high-impact risks are avoided or reduced; low-probability, high-impact risks are transferred (insurance); small risks are accepted. ## Check yourself The answer's key points as multiple-choice questions, with the correct option and why. 1. Which set contains the response strategies for negative risks? A. Exploit, share, enhance, accept B. Avoid, transfer, mitigate, accept C. Plan, do, check, act D. Identify, analyse, rank, close Answer: B. Threats are handled by avoid, transfer, mitigate (reduce) or accept; exploit, share, enhance are for opportunities. (Key point: Strategies for threats) 2. What does the transfer strategy do? A. Removes the risk completely B. Shifts the impact and ownership to a third party, but the risk remains C. Reduces the probability only D. Ignores the risk Answer: B. Insurance, bonds or fixed-price contracts shift the impact to another party; the risk is not removed. (Key point: Transfer) 3. Which risk is best transferred by insurance? A. High probability, high impact B. Low probability, high impact C. Low probability, low impact D. Opportunity risks Answer: B. Low-probability, high-impact risks are transferred; high-high risks are avoided or reduced; small risks are accepted. (Key point: Choosing a strategy) 4. Why is risk response planning important? A. It gives planned action, owners, time and budget before the risk happens, reducing loss B. It guarantees no risk occurs C. It replaces identification D. It increases impact Answer: A. Planned responses with owners and reserves reduce losses and protect cost, schedule and quality. (Key point: Importance) ## Related in Project Engineering - [Why risk analysis is important in planning](https://www.bctengineer.com/question.md?key=semester_7%2Fproject_engineering%3Arisk-importance-analysis-planning) — Project Engineering, chapter 5 - [Risk, sources, risk response planning](https://www.bctengineer.com/question.md?key=semester_7%2Fproject_engineering%3Arisk-define-sources-response-planning) — Project Engineering, chapter 5 - [Why schedule is important in planning](https://www.bctengineer.com/question.md?key=semester_7%2Fproject_engineering%3Aschedule-importance-planning) — Project Engineering, chapter 3 - [Risk planning; internal, external; risk reduction](https://www.bctengineer.com/question.md?key=semester_7%2Fproject_engineering%3Arisk-reduction-internal-external-planning) — Project Engineering, chapter 5 - [Risk transfer, reduction as response techniques](https://www.bctengineer.com/question.md?key=semester_7%2Fproject_engineering%3Arisk-transfer-reduction-response-justify) — Project Engineering, chapter 5, asked 2× - [Define risk; types of project risk](https://www.bctengineer.com/question.md?key=semester_7%2Fproject_engineering%3Adefine-risk-types-of-risk) — Project Engineering, chapter 5, asked 2× ## Related in other subjects - [Importance of risk response planning](https://www.bctengineer.com/question.md?key=semester_7%2Fict_project_management%3Arisk-response-planning-importance) — ICT Project Management, chapter 12 - [Planning for business/IT strategies](https://www.bctengineer.com/question.md?key=semester_8%2Finformation_system%3Aplanning-business-it-strategies) — Information System, chapter 5 - [Gumbel flood at given risk, 50-year project life](https://www.bctengineer.com/question.md?key=semester_5%2Fengineering_hydrology%3Agumbel-risk-63-58-4200) — Engineering Hydrology, chapter 6 - [Project risk](https://www.bctengineer.com/question.md?key=semester_7%2Fict_project_management%3Aproject-risk) — ICT Project Management, chapter 12