Risk Response - Active acceptance - Passive acceptance

sri

Hi
I know contingency reserves are created for active risk acceptance. For passive acceptance of Risks do we create contingency reserves? If we don't create contingency reserves for passive acceptance risks, do we need to use management reserves when these risks happen?

thanks
Sri

SumitK

According to me, Management reserve should be used for Passive risk acceptance.
Rita's book ed-6. page 396 and 402
But not sure. Guru Harwinder will give some great explanation:)

Harwinder

@sri

There's nothing about this in PMBOK 4. So you won't get an official answer to this question. But here's what I think:

With passive risk acceptance, you simply document the risk and leave the project team to deal with the risk if it occurs. Logically speaking, you would adopt this strategy for low severity and low priority risks only. If it's anything beyond that, you would use active risk acceptance strategy, and establish a contingency reserve for the risk.

If a passively accepted risk occurs, you would have to explore the options to deal with it. It may not always require extra funds. But if it does, then of course, you can approach the management for approval to tap into the Management Reserve.

Hope that helps.

sri

Thanks Harwinder and Sumit.

-Sri