The project risk manager on a large firm fixed priced (FFP) contract has an up-to-date risk register with accurate and detailed information. What should the project risk manager do next?

Question

Options

• ARecommend the removal of risks to the project manager to reduce project risk exposure.
• BAdvise the client that the project has exhausted contingency.
• CQuantify the risk exposure that exceeds project contingency.
• DGenerate reports to assess and communicate the project risk level.

• A
  14% (8)
• B
  7% (4)
• C
  78% (46)
• D
  2% (1)

Explanation

On a Firm Fixed Price (FFP) contract, the contractor absorbs all cost risk-the client pays a set price regardless of cost overruns. With an accurate, up-to-date risk register in hand, the logical next step is to perform quantitative risk analysis to determine the total risk exposure, specifically identifying how much of that exposure exceeds the available contingency reserve. This allows the project team to take proactive action before costs spiral beyond recovery. Option A (removing risks) reduces visibility without reducing actual exposure. Option B (advising the client about exhausted contingency) would be premature-quantification comes first. Option D (generating reports) is an output that follows quantification, not the next immediate step.

No community discussion yet for this question.