Management of Risk 4 Practitioner

What are the 4 main principles of MoR?

The MoR framework rests on four fundamental principles: that risk management must be in line with strategy, be tailored to the context, provide value, and support continual improvement.

How are risks identified in MoR?

Risks are identified systematically through a series of techniques. These include workshops where relevant stakeholders brainstorm potential risks, as well as a review of existing documentation such as the risk register and experience data from previous projects.

What are the 4 phases of the MoR process?

The risk management process in MoR consists of four repeating phases: Identify (risks), Assess (probability and impact), Plan (responses), and Implement (the planned responses).

How are risks assessed in MoR?

In MoR, risks are assessed based on a combination of their probability of occurring and their potential impact. The assessment can be qualitative (e.g., low, medium, high) or quantitative, where numerical values are assigned.

What is a risk register in MoR?

A risk register is a central document that contains detailed information about all identified risks. For each risk, a unique identifier, a risk owner, the risk assessment, and planned responses are described.

What is the difference between a threat and an opportunity in MoR?

In MoR, a distinction is made between two types of uncertainty. A threat is an uncertain event that can have a negative impact on goals. An opportunity, on the other hand, is an uncertain event that can have a positive impact.

What is risk culture?

Risk culture is the shared attitudes, values, and behavioral patterns that define how an organization perceives and reacts to risks. A mature risk culture promotes openness about risks and a proactive approach to management.

What is risk tolerance?

Risk tolerance is the specific and measurable limit for the amount of risk an organization is willing to accept. It acts as a boundary for when a risk should be escalated to management.

What is a risk policy?

A risk policy is an official statement from management that describes the organization’s general approach and attitude to risk management. It establishes the overall guidelines for how risks should be handled.

What is a risk management strategy?

A risk management strategy is a detailed document that describes the specific approach that will be used to manage risks for a given program or project. The strategy is a concrete implementation of the overall risk policy.

Who has overall responsibility for risk management in an organization?

The ultimate responsibility for effective risk management lies with the organization’s board of directors or senior management. This group ensures that there is a clear risk policy and that resources are allocated to support it.

What is the role of the risk manager?

The risk manager is a central role that facilitates the risk management process in practice. The role is responsible for coordinating activities, maintaining the risk register, and supporting risk owners.

What is the project manager’s role in risk management?

The project manager is responsible for managing all project risks. He or she ensures that risk management complies with the organization’s risk strategy and that project risks are actively identified, assessed, and handled.

What is a risk owner?

A risk owner is the person who is appointed to take responsibility for a specific risk. This responsibility includes monitoring the risk and ensuring that the planned response is carried out effectively.

What is a risk handler?

A risk handler is the person who is directly responsible for implementing a specific, planned risk response. This role carries out the actions decided by the risk owner.

Who defines the risk strategy?

The risk strategy is defined by senior management or a selected risk management committee. The strategy ensures that all risk management activities are in line with the strategic goals.

What is the difference between a risk manager and a risk owner?

The risk manager has an overall responsibility to facilitate and coordinate the risk management process throughout the organization. The risk owner, on the other hand, is responsible for a specific, individual risk and its management.

What role does communication play in risk management?

Communication is a critical element in risk management. It ensures that all relevant stakeholders, from employees to management, understand the risk landscape and can contribute to a proactive and collective effort.

How does MoR differ from PRINCE2?

PRINCE2 is a project management method for managing the entire project from start to finish, while MoR is a specialized framework for risk management only. The MoR method can be used in PRINCE2 projects to strengthen the risk theme.

How does MoR differ from ISO 31000?

ISO 31000 is an international standard that provides general principles and guidelines for risk management. MoR is an operational framework that delivers concrete, practical techniques and processes that make it possible to implement the principles of ISO 31000 in practice.

How does MoR differ from Agile risk management?

MoR provides a more comprehensive and formal framework than traditional agile risk management. They can be combined by using MoR for overall strategic risk management, while agile teams handle operational risks on a daily basis.

How is MoR used with ITIL?

ITIL is a framework for IT service management. MoR can be used with ITIL to manage risks in IT operations. For example, MoR processes can be used to assess the risk of a ‘change’ in the ITIL Change Management process.

What methods does MoR complement well?

MoR complements other methods within the Best Management Practice portfolio. This applies especially to PRINCE2 for project management, MSP for program management, and ITIL for IT operations, as MoR provides a robust language and a consistent process across these frameworks.

What jobs can MoR Practitioner lead to?

The certification is relevant for a range of job functions, including risk manager, project manager, compliance officer, program manager, and business continuity specialist. It can open doors to more specialized and senior roles.

Can MoR certification lead to a higher salary?

Yes. Specialized certifications like MoR can enhance your salary and earning potential. They demonstrate a sought-after skill set in a world of increasing uncertainty, making you a more valuable asset to an organization.

Is MoR certification enough to get a job?

MoR certification is a strong advantage, but most employers value a combination of certification and relevant professional experience. MoR Practitioner gives you a significant edge, as it proves your ability to apply risk management in practice.

What further education is available after MoR Practitioner?

After completing MoR Practitioner, you can pursue other certifications within the Best Management Practice portfolio. Relevant options include MSP (program management), P3O (PMO management), and PRINCE2 (project management).

How is MoR implemented in an organization?

MoR is typically implemented gradually. An organization may start by defining a risk policy, running a pilot project, and then tailoring and scaling the framework across the entire organization to ensure a smooth transition.

What is the biggest mistake one can make in MoR implementation?

The biggest mistake is treating MoR as a rigid, bureaucratic process. MoR is designed to be practical and value-creating. A rigid approach can delay projects and generate unnecessary resistance from employees.

How is success in risk management measured?

Success can be assessed by whether the organization achieves its goals, reduces the number of unexpected incidents, and responds effectively to new risks. An effective risk management process leads to fewer delays, lower costs, and an improved reputation.

How is MoR tailored for small projects?

In small projects, MoR can be adapted by reducing documentation, combining roles, and simplifying processes. Flexibility is a core aspect of MoR, enabling effective application in any organizational context.

What is the difference between risk and uncertainty?

Risk refers to a known, measurable uncertainty, where we can assess probability and impact. Uncertainty is an unknown event that we cannot predict or assess. MoR focuses on handling both.

What is a risk category?

Risk categories are a way to group risks to create a better overview and more systematic management. Examples of categories can be strategic, financial, operational, or compliance risks.

What is an ‘Issue’ in risk management?

An ‘Issue’ is an event that has occurred and must now be actively handled. In MoR, a distinction is made between risks (future potential events) and issues (events that have already happened).

What is risk prioritization?

Risk prioritization is the process of ranking risks by their importance. The prioritization is typically based on a combination of the risk’s probability and its potential impact, ensuring that the most critical risks are handled first.

What is a risk management plan?

A risk management plan is a document that describes how risk management activities will be carried out in a given project or organization. The plan defines methods, tools, roles, and timelines for risk management.

What is a risk response?

A risk response is a planned action to counter a risk. The four main strategies are to avoid the risk, reduce its probability or impact, transfer the risk to a third party, or accept the risk.

What is ‘Contingency’ in risk management?

‘Contingency’ is a reserve in time, budget, or resources that is set aside to handle unforeseen risks. It is a proactive measure that ensures the organization has the means to react to incidents if they occur.

What is risk tolerance?

Risk tolerance is the specific limit for the amount of risk an organization is willing to accept. It helps define which risks are acceptable and which must be escalated to management.

What is a risk profile?

A risk profile provides a comprehensive overview of the most significant risks that an organization faces. It is used to communicate the risk landscape to management and stakeholders and to focus resources on the most important risk areas.

What is a risk matrix?

A risk matrix is a visual tool used to plot risks based on their probability and impact. The matrix helps to prioritize risks and provides a quick overview of the most critical threats and opportunities.

What is a SWOT analysis in relation to risk management?

A SWOT analysis (Strengths, Weaknesses, Opportunities, Threats) can be used in risk management to identify both internal and external factors. It can help uncover both threats (T) and opportunities (O), which can then be included in the risk register.

What is ‘Risk Appetite’?

‘Risk Appetite’ is the organization’s overall attitude towards taking risks in the pursuit of its strategic goals. It describes the desired amount of risk that one is willing to assume.

What is ‘Risk Capacity’?

‘Risk Capacity’ is the maximum amount of risk that an organization can bear without compromising its survival or ability to meet its obligations.

What is a risk committee?

A risk committee is a group, typically consisting of senior managers, who are responsible for monitoring and managing risk management at a strategic level in the organization.

What is a ‘Risk Checklist’?

A ‘Risk Checklist’ is a list of potential risks that are based on experiences from previous projects or industries. It is used as a tool to ensure that typical risks are not overlooked.

What is a ‘Risk Breakdown Structure’?

A ‘Risk Breakdown Structure’ is a hierarchical diagram used to categorize and organize risks in a logical structure. It helps to ensure that all risk areas are covered systematically.

What is a ‘Risk Workshop’?

A ‘Risk Workshop’ is a facilitated meeting where stakeholders gather to brainstorm, identify, and assess risks in a project or an organization. It is an effective way to engage collective knowledge.

What is ‘Risk Reporting’?

‘Risk Reporting’ is the process of communicating risks and their status to relevant stakeholders. The reporting ensures that management and other key personnel are informed about the risk landscape.

What is a ‘Risk Budget’?

A ‘Risk Budget’ is a portion of a project budget that is set aside to cover the financial consequences if identified risks occur. It is an important element in handling risks proactively.

What is a ‘Risk-aware Culture’?

A ‘Risk-aware Culture’ is a culture where risk management is a natural and integrated part of all decisions. In such a culture, employees are aware of risks and talk openly about them.

What is a ‘Risk Appetite Statement’?

A ‘Risk Appetite Statement’ is a formal statement that defines the amount and type of risk an organization is willing to accept. It guides all decisions about risk management.

What is ‘Residual Risk’?

‘Residual Risk’ is the risks that remain after a planned risk response has been implemented. It is important to identify and monitor residual risks.

What is ‘Secondary Risk’?

‘Secondary Risk’ is new risks that arise as a direct consequence of a planned risk response. These new risks must also be identified and managed.

What is a ‘Risk Map’?

A ‘Risk Map’ is a visual tool, which is typically a 2×2 matrix, where risks are plotted based on their probability and impact. It provides a quick overview of the most critical risks.

What is ‘Risk Management Policy’?

‘Risk Management Policy’ is an overarching document that describes the organization’s principles, approach, and goals for risk management.

What is a ‘Risk Management Strategy’?

‘Risk Management Strategy’ describes how risk management will be concretely implemented in a specific project or program. It is an action plan for risk management.

What is ‘Risk Management Process’?

‘Risk Management Process’ are the specific steps followed in risk management.

What is ‘Risk Management Structure’?

‘Risk Management Structure’ are the roles and responsibilities related to risk management.

What is ‘Risk Management Culture’?

‘Risk Management Culture’ are the values and attitudes that characterize risk management.