Project Manager's Risk Strategy: Contracting a Third-Party Vendor for Achieving Milestones
Question
A project manager has contracted a third-party vendor to achieve milestones.
Which of the following risk strategies is the project manager applying?
Answers
Explanations
Click on the arrows to vote for the correct answer
A. B. C. D.A.
238
The risk strategy that the project manager is applying when contracting a third-party vendor to achieve milestones is Transfer, which is option A.
Risk transfer is a risk management strategy that shifts the risk of a project from one party to another party, typically to a third-party vendor or insurance company, in exchange for payment or other consideration. In this case, the project manager has contracted a third-party vendor to achieve milestones, which means that the vendor is responsible for completing certain tasks and achieving specific project goals.
By transferring the risk to the third-party vendor, the project manager is reducing the impact of the risk on the project by shifting the responsibility of completing the tasks and achieving the goals to the vendor. This allows the project manager to focus on other aspects of the project without having to worry about the specific tasks that the vendor is responsible for.
It's important to note that while risk transfer is an effective risk management strategy, it doesn't completely eliminate the risk. The project manager is still responsible for managing the overall project and ensuring that the vendor completes the tasks on time and to the required quality standards.
Therefore, the best answer is A. Transfer.
