4/24/25, 6:36 PM Skillsoft Topic Transcript

Topic Transcript

Exercise: Responding to Risks

Learning Objective
After completing this topic, you should be able to
use techniques to effectively respond to risks

Exercise Overview
Once you've identified and assessed risks, you then have to deal with them. Regardless of the risk
you face, it's important to handle threats and opportunities in an effective manner.

In this exercise, you'll demonstrate that you can

recognize types of responses to threats

recall the correct order of responses to opportunities, and
identify examples of contingent response strategies

Question

Match each example to the avoidance technique it best represents.

Options:

A. Decide not to make a presentation

B. Ensure team members are paid competitive rates
C. Revise an order to ensure all items can be delivered within 24 hours

Targets:

1. Avoid the threat altogether

2. Adjust your plan to avoid the effects of the threat
3. Eliminate the cause of the threat

Answer

Deciding not to make a presentation is an example of avoiding a threat altogether. For this
approach to be effective, you need to be in a position to take whatever steps are

https://library.skillport.com/courseware/Content/cca/ast_01_a05_bs_enus/output/t28/misc/transcript.html 1/7
4/24/25, 6:36 PM Skillsoft Topic Transcript

necessary to prevent the threat from occurring.

Revising an order to ensure all items can be delivered within 24 hours is an example of
adjusting your plan to avoid the effects of a threat. Avoiding a threat should always be
high priority.

Ensuring team members are paid competitive rates is an example of eliminating the cause
of a threat. For example, if the cause of people resigning – being underpaid – is
eliminated, this threat shouldn't occur.

Correct answer(s):

Target 1 = Option A

Target 2 = Option C

Target 3 = Option B

Question

Which of these responses are examples of transferring risk?

Options:

1. Purchase an insurance policy to protect your factory against flooding

2. Include financial penalties in a contract in case the work isn't completed to the
required standard
3. Ask an administrator to organize and archive guarantees
4. Terminate an existing contract and choose a better supplier
5. Insist that an unreliable contractor issues a performance bond
6. Ensure your IT supplier provides you with a written warranty

Answer

Option 1: This option is correct. The most common form of risk transference is insurance,
where you pay a premium for protection against financial loss.

Option 2: This option is correct. Contracts can be designed to transfer specific risks to
contractors, or sellers of products or services.

Option 3: This option is incorrect. While it's important that guarantees are properly stored,
transferring risk involves making sure you receive a guarantee in the first place.

Option 4: This option is incorrect. This is an example of avoiding a threat, not transferring
it.

https://library.skillport.com/courseware/Content/cca/ast_01_a05_bs_enus/output/t28/misc/transcript.html 2/7
4/24/25, 6:36 PM Skillsoft Topic Transcript

Option 5: This option is correct. A performance bond specifies an amount of money to be

paid in the event that the contractor fails to deliver the promised results.

Option 6: This option is correct. Many products, such as vehicles, televisions, and
computers typically come with warranties.

Correct answer(s):

1. Purchase an insurance policy to protect your factory against flooding

2. Include financial penalties in a contract in case the work isn't completed to the required
standard
5. Insist that an unreliable contractor issues a performance bond
6. Ensure your IT supplier provides you with a written warranty

Question

Which statements are examples of mitigating a threat?

Options:

1. Reduce the chain of command in your division

2. Invite a consumer panel to use a new product before it's launched
3. Insist that a new piece of machinery comes with a guarantee
4. Choose a supplier who has won an award for outstanding service
5. Turn down a request by a journalist for an interview
6. Ensure your manufacturing plant has a backup generator

Answer

Option 1: This option is correct. Reducing the chain of command in your division is an
example of adopting less-complex procedures. This can help to mitigate the threat of
confusion.

Option 2: This option is correct. Inviting a consumer panel to use a new product before
it's launched is an example of conducting more tests. This mitigates the threat that a
product will fail to satisfy consumers when it's launched.

Option 3: This option is incorrect. This is an example of transferring a threat, not

mitigating it. Mitigation involves reducing the probability of threats occurring – and
reducing the impact they'll have if they do occur – to acceptable levels.

Option 4: This option is correct. Choosing a supplier who has won an award for
outstanding service is an example of choosing a more-stable supplier. By using a
reputable supplier with a proven track record, you mitigate the threat of delivery problems.

Option 5: This option is incorrect. This is an example of avoiding a threat, not mitigating
it. You should mitigate threats when avoiding or transferring them isn't feasible.
https://library.skillport.com/courseware/Content/cca/ast_01_a05_bs_enus/output/t28/misc/transcript.html 3/7
4/24/25, 6:36 PM Skillsoft Topic Transcript

Option 6: This option is correct. Ensuring your manufacturing plant has a backup
generator is an example of building redundancy into a system. This mitigates the risk of
system failures in the event of a power outage.

Correct answer(s):

1. Reduce the chain of command in your division

2. Invite a consumer panel to use a new product before it's launched
4. Choose a supplier who has won an award for outstanding service
6. Ensure your manufacturing plant has a backup generator

Question

Match each example to the type of threat acceptance it represents. Each type of
acceptance can have more than one match.

Options:

A. Make a list of contractors you can call on in the event that your workers decide
to strike, and budget for the services of those contractors
B. Recognize bad weather is likely to impact some public events you'd been
planning to promote a new product
C. Accept construction is going to impact your deliveries, but plot alternate routes
and inform customers about the delays
D. Accept some key workers may decide to leave, at which point you can try to
find suitable replacements

Targets:

1. Passive acceptance
2. Active acceptance

Answer

Passive acceptance involves doing nothing unless a threat arises, then you try to tackle
the consequences.

Active acceptance involves accepting a threat, but planning in advance how to handle the
consequences if the threat is realized. Active risk acceptance involves not only planning,
but also ensuring sufficient reserves are set aside to execute your backup plans if they're
needed. These contingency reserves can include money and time.

Correct answer(s):

Target 1 = Option B, Option D

https://library.skillport.com/courseware/Content/cca/ast_01_a05_bs_enus/output/t28/misc/transcript.html 4/7
4/24/25, 6:36 PM Skillsoft Topic Transcript

Target 2 = Option A, Option C

Question

Place the responses to an opportunity in the correct order.

Options:

A. Partner with another company to strengthen your chances of winning a

contract
B. Acquire a struggling competitor to ensure that your organization is the sole
business in the market
C. Agree to a client's proposal that you provide a helpdesk service in order to
retain their business
D. Make sure there is no padding in your bid price and make plans to expand
capacity to satisfy demand if it is successful

Answer

Correct answer(s):

Acquire a struggling competitor to ensure that your organization is the sole

business in the market is ranked
You first response to an opportunity should be to determine whether it can be
exploited. The exploit approach makes sure the opportunity you're dealing with - in this
case the opportunity to monopolize the market - isn't squandered. It seeks to maximize
the chances of the opportunity occurring.
Make sure there is no padding in your bid price and make plans to expand
capacity to satisfy demand if it is successful is ranked
If it's not possible to exploit an opportunity, your next response should be to try to
enhance it yourself. Enhancing involves taking specific steps to improve the likelihood
that the opportunity will actually occur, as well as increasing its potential impact.
Partner with another company to strengthen your chances of winning a contract
is ranked
If you're unable to exploit an opportunity or enhance it yourself, then the next response
to consider is sharing the opportunity with another party. Ally with an external party
who is able to handle the opportunity best to increase the likelihood of securing
benefits, and agree to share the rewards.
Agree to a client's proposal that you provide a helpdesk service in order to retain
their business is ranked
The final response you should contemplate when faced with an opportunity is to
accept it. If you can't exploit, enhance, or share an opportunity, you may have no

https://library.skillport.com/courseware/Content/cca/ast_01_a05_bs_enus/output/t28/misc/transcript.html 5/7
4/24/25, 6:36 PM Skillsoft Topic Transcript

alternative but to accept it. If the opportunity is small, doesn't provide any important
benefits, or is too costly to embrace, you may choose to respond in this way.

Question

A chosen supplier for a project offers the lowest costs. However, there's a risk that this
supplier could shut down during the course of the project.

Which response to the risk illustrates the appropriate use of a contingent response
strategy?

Options:

1. You accept the risk and plan to respond to it as it affects the project
2. You create a plan, with budgetary and time reserves, for buying materials from
the next preferred supplier on your list, although this supplier is more
expensive
3. You try to transfer the risk to the supplier, who is facing bankruptcy, by
insisting that this supplier honors the supply contract
4. At the start of the project, you submit a request to change the product scope
by switching to a material that is available from a number of lower-quality
suppliers

Answer

Option 1: This option is incorrect. Passively accepting the risk, without defining a clear
plan or allocating reserves to cover it, isn't an example of a contingent response strategy.

Option 2: This is the correct option. By developing a plan and allocating reserves, you
ensure you can respond appropriately if the risk of losing a key supplier actually occurs.

Option 3: This option is incorrect. Insisting the supplier honors the contract isn't a
contingent response strategy. You must develop a sensible contingency plan, or set aside
any reserves to handle the risk.

Option 4: This option is incorrect. Changing project scope is a mean of attempting to

mitigate the risk by eliminating the risk cause. A contingent response strategy would
involve planning and assigning reserves for handling the risk only if and when it does
occur.

Correct answer(s):

2. You create a plan, with budgetary and time reserves, for buying materials from the
next preferred supplier on your list, although this supplier is more expensive

https://library.skillport.com/courseware/Content/cca/ast_01_a05_bs_enus/output/t28/misc/transcript.html 6/7
4/24/25, 6:36 PM Skillsoft Topic Transcript
© 2019 Skillsoft Ireland Limited

https://library.skillport.com/courseware/Content/cca/ast_01_a05_bs_enus/output/t28/misc/transcript.html 7/7