Risk, Change and Decision Management

Introduction and Context

Construction projects are delivered in conditions of uncertainty. Ground conditions may differ from site investigations, material prices may change, labour productivity may fall, design information may be incomplete, and clients may alter their requirements. These events can affect cost, time, quality, safety, environmental performance and contractual relationships.

Risk, change and decision management provide a systematic way to deal with these conditions. Risk management concerns uncertain events or conditions that may affect project objectives. Change management controls modifications to the approved scope, design, programme, cost or methods. Decision management ensures that choices are based on reliable information, appropriate authority, transparent reasoning and timely action.

These activities are closely connected. A risk may occur and become an actual change; a proposed change may create new risks; and a decision may determine whether a risk is transferred, reduced, accepted or avoided. Effective construction managers therefore treat them as an integrated management process rather than isolated administrative tasks.

Learning Objectives

After studying this chapter, the learner should be able to:

1. Explain the meaning and importance of construction risk, change and decision management.
2. Identify risks using structured techniques and record them in a risk register.
3. Assess risks using probability–impact matrices and basic quantitative methods.
4. Select practical responses to threats and opportunities.
5. Explain the causes and control of construction changes and delays.
6. Apply a documented decision-making process to construction problems.
7. Recognise the ethical, contractual and professional responsibilities associated with risk and change.

1. Fundamental Concepts

1.1 Risk and uncertainty

A risk is an uncertain event or condition that, if it occurs, may have a positive or negative effect on one or more project objectives. Negative risks are often called threats, while positive risks are called opportunities. Uncertainty is the broader condition of incomplete knowledge. Not every uncertainty can be expressed reliably as a probability; however, it should still be recognised and managed.

A risk statement should identify three elements:

• Cause: the underlying source of uncertainty;
• Risk event: what might happen; and
• Effect: the consequence for the project.

For example, “Heavy rainfall may flood the excavation, causing additional pumping, lost working days and increased cost” is stronger than “weather risk.” It identifies a cause, event and effect.

Risk is not the same as a problem. A risk may happen in the future; a problem or issue has already occurred and requires action. Once a risk occurs, it should be transferred from the risk register to an issue or change-control process where appropriate.

1.2 Risk categories

Construction risks can be grouped in several ways. A practical classification is shown below.

The categories should be adapted to the project. A risk breakdown structure helps prevent attention from being concentrated only on cost and programme while safety, quality and reputation are neglected.

1.3 Risk appetite and tolerance

Risk appetite is the general amount and type of risk an organisation is willing to accept in pursuit of its objectives. Risk tolerance is the acceptable variation around a specific objective. For example, an organisation may have zero tolerance for fatality risk, a low tolerance for regulatory non-compliance, and a defined tolerance of ±5% for a cost forecast.

Risk decisions should be proportionate. A minor office-supply delay does not require the same analysis as a risk of structural instability. Safety, legal compliance and protection of the public normally receive priority even when their financial probability-impact score is modest.

1.4 Change, variation and issue

A change is a modification to an approved baseline. Baselines commonly include scope, drawings, specifications, budget, programme, quality requirements and construction method. A variation is a change instructed or recognised under a contract. Its precise meaning depends on the contract conditions. An issue is a current matter requiring resolution; it may result from an occurred risk, a disputed instruction, a defect or a stakeholder concern.

A change may be:

• client-initiated;
• design-generated;
• contractor-proposed;
• regulatory;
• caused by unforeseen physical conditions; or
• required to correct an error or omission.

Not every instruction is automatically a valid contractual variation. The project team must check authority, notice requirements, valuation rules, time entitlement and the effect on other obligations.

1.5 Decision management

Decision management is the disciplined process of defining a decision, obtaining relevant evidence, evaluating alternatives, approving an action and recording the reasoning. Good decisions are timely and traceable. A decision record should allow a later reviewer to understand what was known at the time, what assumptions were made, who authorised the decision and how the result will be monitored.

2. The Construction Risk Management Process

A practical risk process consists of five connected activities:

1. Plan risk management: establish methods, roles, categories, reporting frequency and escalation rules.
2. Identify risks: gather information from documents, experts, site observations and stakeholders.
3. Analyse risks: estimate probability and impact qualitatively or quantitatively.
4. Plan responses: select actions that reduce threats or increase opportunities.
5. Monitor and control: track triggers, owners, response actions, residual risk and emerging risks.

Risk management is iterative. A design development, procurement decision or site discovery may require the register to be reviewed immediately rather than waiting for a monthly meeting.

2.1 Risk identification techniques

Useful techniques include:

• Document review: examine drawings, specifications, surveys, geotechnical reports, contracts, permits and previous project records.
• Work breakdown structure review: consider risks at each work package, such as excavation, concrete, mechanical services and commissioning.
• Site walks and inspections: observe access, interfaces, temporary works, drainage, utilities and neighbouring property.
• Brainstorming and workshops: involve designers, supervisors, subcontractors, suppliers and client representatives.
• Checklists: use historical risks, but do not treat a checklist as complete.
• Interviews and expert judgement: obtain specialist knowledge where evidence is limited.
• Cause-and-effect analysis: trace how a cause can produce an event and consequence.
• Assumption analysis: identify assumptions that may be false, such as assumed productivity or material availability.
• Interface analysis: examine handovers among design, procurement, construction, commissioning and operations.

Risk descriptions should be specific and actionable. “Subcontractor issue” is weak; “The façade subcontractor may fail to mobilise by the planned date because shop drawings are incomplete, delaying enclosure and internal works” is more useful.

2.2 The risk register

The risk register is the principal working record for project risks. A compact register may include the following fields:

The risk owner is accountable for ensuring that the risk is understood and managed. The action owner is responsible for a particular response task; these may be different people. A register that contains names but no due dates, triggers or follow-up is unlikely to control risk effectively.

3. Qualitative Risk Assessment

3.1 Probability–impact assessment

Qualitative assessment ranks the likelihood of occurrence and the severity of consequences. A project may use scales from 1 to 5. For example, probability may range from 1 = rare to 5 = almost certain, while impact may range from 1 = insignificant to 5 = severe.

A simple risk score is:

where:

• R = risk score;
• P = probability rating; and
• I = impact rating.

The score is dimensionless because both inputs are ordinal ratings, not measured physical quantities. It is therefore a prioritisation aid, not a precise prediction of monetary loss. A project might classify scores 1–4 as low, 5–9 as moderate, 10–16 as high and 17–25 as extreme, but the boundaries must be approved for the particular project.

The assessment should consider more than cost. Separate impact columns may be used for safety, cost, time, quality, environment and reputation. A single combined score can hide a critical safety consequence behind a low financial value.

3.2 Worked example: qualitative assessment

An excavation risk is assessed as follows:

• probability rating: 4, because water ingress has occurred on nearby sites and the groundwater investigation is limited;
• programme impact rating: 4, because pumping and remediation could delay the excavation by several weeks.

Therefore:

Using the example classification, the risk is high. The team may install monitoring points, confirm a dewatering design, obtain pumps and standby power, and establish an escalation procedure. After these actions, the probability may be reassessed as 2 and the impact as 3, giving a residual score of:

The residual score does not mean that the risk has disappeared. It indicates that exposure is expected to be lower if the actions are implemented and maintained.

3.3 Limits of matrices

Matrices are easy to explain and useful for screening, but they have limitations. Categories such as “possible” and “major” may be interpreted differently by different assessors. Multiplying ordinal ratings does not produce a true probability distribution, and two risks with the same score may have very different consequences. A rare risk with catastrophic impact should not automatically be treated as less important than a frequent minor delay.

For high-consequence decisions, use explicit narrative, specialist review and, where justified, quantitative analysis. A matrix should support professional judgement, not replace it.

4. Basic Quantitative Risk Techniques

4.1 Expected monetary value

When possible outcomes and probabilities can be estimated, expected monetary value (EMV) provides a simple numerical comparison:

where pᵢ is the probability of outcome i, Cᵢ is its monetary consequence, and the summation covers all mutually exclusive outcomes. Positive and negative values must be defined consistently. For a threat, a cost may be recorded as positive exposure; for an opportunity, a benefit may be recorded as positive value. EMV is an average over repeated comparable situations, not a guaranteed project result.

If a risk has a 0.25 probability of causing an additional cost of £40,000, its expected cost is:

This does not mean that the project will incur exactly £10,000. The actual outcome is either realised or not realised, and the estimate is subject to uncertainty.

For several mutually exclusive outcomes:

The expected cost is £14,000. The probabilities must sum to 1.00 for a complete set of mutually exclusive outcomes.

4.2 Decision trees

A decision tree compares alternatives and uncertain outcomes. Each chance branch has probabilities that sum to 1.00, and each decision alternative is evaluated using the expected value of its branches. For a simple choice, suppose a contractor can buy a £6,000 standby pump or rely on emergency hire. Without the standby pump, there is a 0.20 probability of a £40,000 disruption. With the pump, the probability falls to 0.05 and the remaining disruption cost is £20,000.

Expected cost without purchase:

Expected cost with purchase:

On these assumptions, the purchase has the lower expected cost by £1,000. The decision should still consider safety, availability, maintenance, confidence in the probabilities and the consequence of a failure. Expected value is not the sole decision criterion.

4.3 Probability distributions and contingency

A contingency allowance is a planned provision for identified uncertainty. It should not be used as an unexplained reserve to conceal poor estimating or unauthorised scope. A basic risk-based contingency can be informed by the sum of expected costs for relevant independent risks, but simple addition may be misleading when risks are correlated.

For example, several material-price risks may arise from the same market condition. Treating them as independent can overstate or understate exposure. More advanced methods, such as simulation, sensitivity analysis and correlation modelling, may be used on larger projects, but they require reliable data and competent interpretation.

5. Risk Response Planning

Responses should address the cause, event or consequence and should be assigned to an accountable person. Common responses to threats are:

• Avoid: change the design, method or scope so that the threat no longer applies.
• Reduce or mitigate: lower probability or impact, such as through surveys, training, protection or redundancy.
• Transfer or share: allocate financial or operational consequences to another party through insurance, contract terms, warranties or specialist subcontracting. Transfer does not remove the underlying hazard or the client’s ultimate legal duties.
• Accept: take no preventive action beyond monitoring, or establish a contingency if the risk occurs. Acceptance should be explicit.
• Escalate: refer the risk to a higher authority when it exceeds the project manager’s control or tolerance.

Responses to opportunities include exploiting, enhancing, sharing and accepting. A response should be tested for secondary risks. For example, accelerating work may reduce a completion risk but increase fatigue, quality defects and safety exposure.

A useful response plan states the action, owner, deadline, required resources, trigger and success measure. After implementation, assess residual probability and impact. Close a risk only when its cause can no longer affect the project, the relevant work is complete, or the risk has been formally transferred or accepted.

6. Managing Change and Delay

6.1 The change-control process

A disciplined change process normally follows these stages:

1. Record the proposed change and its origin.
2. Confirm whether it is within the existing scope or is a contractual change.
3. Describe the technical, cost, time, quality, safety, environmental and operational effects.
4. Obtain quotations, programme analysis and design review where necessary.
5. Identify new risks and required approvals.
6. Decide whether to approve, reject, defer or request further information.
7. Issue an authorised instruction or agreement.
8. Update drawings, specifications, budget, programme, procurement records and risk register.
9. Verify implementation and close the change record.

No physical work should normally proceed on a significant change without appropriate written authority. Emergency action may be necessary to protect life, property or the works, but it should be documented immediately afterwards.

6.2 Change evaluation

A change evaluation should distinguish direct and indirect effects. Direct cost may include labour, materials, plant and subcontractor charges. Indirect effects may include rework, disruption, prolongation, remobilisation, loss of productivity, financing cost and effects on other trades. Time analysis should identify the affected activities and determine whether the change affects the critical path.

The critical path is the longest sequence of logically connected activities controlling the earliest possible completion date. A change to a non-critical activity may consume available float without changing completion. A change to a critical activity may create a compensable or non-compensable delay depending on the contract and facts.

Delay analysis requires reliable baseline and update programmes, progress records, instructions, correspondence, photographs, labour and plant records, and evidence of actual effects. A late event does not automatically establish entitlement to additional time or money. Causation, contractual responsibility, notice, mitigation and concurrency must be considered.

6.3 Good change records

Each change record should include a unique number, description, originator, date, related drawing or instruction, reason, estimated cost, time effect, status, approval and implementation evidence. Version control is essential. Superseded drawings should be clearly marked to prevent construction from outdated information.

7. Decision Management in Practice

7.1 A structured decision cycle

A practical decision cycle is:

1. Define the decision and the deadline.
2. State the objectives and constraints.
3. Identify feasible alternatives, including “do nothing” where appropriate.
4. Gather proportionate evidence.
5. Identify risks, assumptions and affected stakeholders.
6. Compare alternatives against agreed criteria.
7. Select and approve the preferred option.
8. Communicate responsibilities and implement the decision.
9. Monitor outcomes and capture lessons.

Decision criteria may include safety, legal compliance, cost, time, quality, constructability, carbon, maintenance and stakeholder effects. A weighted scoring model can be useful for moderate-complexity choices. If criterion weights wⱼ sum to 1 and option scores sᵢⱼ are assigned on a consistent scale, a weighted score is:

where Sᵢ is the total score for option i. This method assumes that the criteria are sufficiently independent and that the scoring scale is applied consistently. It should not override mandatory legal or safety requirements.

7.2 Decision records

A decision record should contain:

• decision title and reference;
• issue and required decision date;
• available information and assumptions;
• options considered;
• evaluation criteria;
• risk and opportunity effects;
• recommendation and rejected alternatives;
• approver and delegated authority;
• required actions, owners and dates; and
• review point and outcome.

Recording rejected alternatives is valuable because it demonstrates that the decision was considered rather than accidental. It also supports learning and protects the integrity of the project record.

7.3 Bias and information quality

Construction decisions can be distorted by optimism bias, confirmation bias, anchoring on an early estimate, pressure to protect a relationship, or reluctance to report bad news. Controls include independent review, challenge meetings, explicit assumptions, range estimates, escalation rules and comparison with actual performance. Information should be current, traceable and appropriate to the decision’s importance.

8. Applied Case: Illustrative Urban Excavation Project

Background

A contractor is constructing a three-storey commercial building with one basement in a constrained urban site. The programme allows 16 weeks for excavation and basement construction. The contract requires the contractor to protect adjacent properties and maintain access to a neighbouring building.

Problem

During excavation, groundwater enters through a previously unidentified sand layer. The excavation side is stable, but water affects the formation level and creates a risk of settlement near the neighbouring building. The issue may cause delay, additional pumping cost and environmental discharge concerns.

Analysis

The team records the following risk:

Because the geotechnical investigation did not identify the continuous sand layer, groundwater may enter the excavation, causing unstable working conditions, formation remediation, settlement of adjacent ground, delay and additional cost.

The initial qualitative assessment is probability 4 and impact 5 for safety and programme, producing a score of 20. The team immediately applies a hierarchy of controls: restrict access, inspect temporary works, install monitoring points, obtain specialist geotechnical advice and control water discharge. It does not rely solely on personal protective equipment or on the risk score.

Three options are reviewed:

• continue with existing pumping;
• install a designed well-point system with standby power; or
• pause excavation and install a more extensive cut-off system.

The second option costs £18,000, has an estimated 0.10 probability of a £30,000 disruption, and is expected to protect the programme. The first option has no immediate capital cost but a 0.35 probability of a £60,000 disruption. The third option costs £55,000 and has a 0.05 probability of a £20,000 disruption.

Expected costs are:

• existing pumping: 0.35 × £60,000 = £21,000;
• well-point system: £18,000 + (0.10 × £30,000) = £21,000;
• cut-off system: £55,000 + (0.05 × £20,000) = £56,000.

The first two options have equal expected cost, so the decision cannot be based on EMV alone. The well-point system provides better control, standby capacity and a more credible safety margin than continuing with existing pumping. The team therefore selects it, subject to specialist design and approval.

Approach and outcome

The contractor submits a technical proposal and change notice. The project manager assesses the cost and programme effect, while the designer confirms the method and the environmental specialist confirms discharge requirements. Monitoring thresholds are defined: rising groundwater, unexpected movement or turbidity triggers escalation. The client authorises the additional work, and the programme is updated.

The system is installed, monitoring shows no significant adjacent settlement, and excavation proceeds with a three-day delay rather than the several-week disruption initially feared. The risk register records a lower residual risk, but the issue remains open until basement waterproofing and reinstatement are complete.

Learning points

1. A specific cause–event–effect statement supports practical action.
2. Safety and protection of third parties must not be reduced to a financial calculation.
3. A risk response can create a change requiring authority and cost control.
4. Equal expected costs require consideration of resilience, safety, confidence and non-financial consequences.
5. Monitoring thresholds convert a general concern into a managed control system.
6. Records of instructions, design reviews, monitoring and expenditure support accountability and later claims analysis.

9. Governance, Ethics and Professional Responsibility

Risk and change management involve ethical obligations. Managers must not conceal known risks, manipulate probability ratings, split changes to avoid approval thresholds, or pressure personnel to work under unsafe conditions. Reports should distinguish fact, estimate, assumption and opinion.

Important governance controls include segregation of duties, delegated authority limits, audit trails, document control, conflict-of-interest declarations and independent review of high-consequence decisions. Contractual notice provisions should be followed, but contractual strategy must never be used to obscure safety or regulatory duties.

Construction professionals also have responsibilities to workers, the public, clients, subcontractors and future users of the facility. A short-term saving that increases latent defects, carbon emissions or maintenance burden may be an unacceptable decision even if it improves the immediate budget.

Regulatory requirements differ by jurisdiction, but commonly involve occupational health and safety, building control, environmental protection, planning permissions, public access, data protection and records retention. The project team must consult current legislation, contract conditions and competent specialists rather than relying on a generic risk template.

10. Digital Tools, Technology and Contemporary Practice

Common digital tools include document-management systems, mobile inspection applications, programme software, geographic information systems, building information modelling and dashboard reporting. These tools can improve version control, evidence capture, workflow and visibility of overdue actions.

Artificial intelligence may assist with extracting potential risks from documents, identifying unusual cost or programme patterns, comparing revisions and searching historical records. However, AI outputs may be incomplete, biased or based on incorrect source information. A competent person must validate the output, protect confidential data and retain responsibility for the decision. AI should support professional judgement rather than replace site inspection, engineering review or contractual authority.

Contemporary risk practice increasingly considers climate resilience, extreme weather, supply-chain fragility, cybersecurity, modern methods of construction and embodied carbon. These issues should be integrated into the same basic process: identify, assess, respond, monitor and document. Scenario planning is particularly useful where historical probabilities are unreliable, such as unprecedented weather or geopolitical disruption.

11. Challenges and Limitations

Risk and decision systems fail for several recurring reasons:

• registers are created for reporting rather than control;
• risks are written vaguely and lack owners;
• probability and impact ratings are copied from earlier meetings;
• emerging risks are ignored because they do not fit the original categories;
• actions are recorded without resources or deadlines;
• changes are implemented before authority is obtained;
• programme updates do not reflect approved changes;
• commercial interests discourage truthful reporting;
• data are incomplete or inconsistent; and
• quantitative precision creates false confidence.

The remedy is not necessarily a more complicated model. Effective practice usually depends on clear definitions, competent participation, timely escalation, reliable records and visible management support. Quantitative methods are most useful when their assumptions are stated and their limitations understood.

12. Best-Practice Checklist

Before closing a risk, change or decision, ask:

• Is the cause, event and consequence clearly stated?
• Has the relevant safety, legal and environmental significance been considered?
• Is there a named owner and a dated action?
• Are probability and impact ratings supported by evidence?
• Has residual risk been assessed after the response?
• Has the effect on scope, cost, programme, quality and interfaces been checked?
• Is the required authority clear and documented?
• Have drawings, schedules, budgets and registers been updated?
• Are triggers, monitoring arrangements and escalation thresholds defined?
• Can an independent reviewer understand what was decided and why?

Chapter Summary

Construction projects contain uncertainty that can affect safety, cost, time, quality, environment and stakeholder confidence. Risk management identifies uncertain events, assesses their significance, plans responses and monitors residual exposure. A risk register is the central record, while a probability–impact matrix provides a practical qualitative prioritisation tool. Its scores are useful indicators, not precise probabilities.

Basic quantitative methods, including expected monetary value and decision trees, help compare alternatives when probabilities and consequences can be estimated. Their outputs depend on assumptions and should be combined with professional judgement, safety considerations and resilience analysis.

Change management controls modifications to approved scope, design, cost, programme or methods. A proposed change should be recorded, evaluated, authorised, implemented and reflected in project records. Delay analysis requires evidence, causation and contractual understanding; a late event does not automatically create entitlement.

Decision management provides a transparent route from issue definition to evidence, alternatives, approval, implementation and review. Good records identify assumptions, authority, responsibilities and outcomes. Ethical practice requires honest reporting, competent review, protection of people and the public, and responsible use of digital and AI tools.

Key Terms

Risk: An uncertain event or condition that may affect project objectives.

Threat: A risk with a potentially negative effect.

Opportunity: A risk with a potentially positive effect.

Uncertainty: Incomplete knowledge about future conditions or outcomes.

Risk owner: The person accountable for managing a particular risk.

Risk register: A controlled record of identified risks, assessments, owners, actions and status.

Risk breakdown structure: A hierarchical classification of risk sources.

Probability–impact matrix: A grid used to combine likelihood and consequence ratings.

Residual risk: Risk remaining after responses have been implemented.

Risk appetite: The general amount and type of risk an organisation is willing to accept.

Risk tolerance: The acceptable variation around a specific objective.

Issue: A current matter requiring action or resolution.

Change: A modification to an approved project baseline.

Variation: A contractually recognised or instructed change.

Baseline: The approved reference for scope, cost, time or technical requirements.

Critical path: The sequence of activities controlling the earliest project completion date.

Expected monetary value: A probability-weighted average of possible monetary consequences.

Contingency: A planned provision for identified uncertainty.

Decision record: A documented account of alternatives, evidence, approval and actions.

Trigger: An observable condition indicating that a risk or response requires attention.

Review Questions

Short Answer Questions

1. Distinguish between a risk, an issue and a change.
2. What three elements should be included in a well-written risk statement?
3. State two limitations of a probability–impact matrix.
4. Name four possible responses to a negative risk.
5. Identify five items that should appear in a decision record.

Long Answer Questions

1. Explain the complete construction risk management process, from planning through monitoring.
2. Describe the structure and purpose of a project risk register.
3. Explain how a proposed construction change should be evaluated and controlled.
4. Discuss the relationship between risk management, change management and delay management.
5. Explain the ethical and governance responsibilities of a construction manager when reporting risk and approving change.

Analytical / Application Questions

1. A project risk has a probability rating of 3 and an impact rating of 5. Calculate its matrix score and explain why the score should not be treated as a precise monetary prediction.
2. A supplier delay has a 0.30 probability of causing a £50,000 cost, while an alternative supplier costs £8,000 and reduces the probability to 0.08 with a £30,000 consequence. Compare the expected costs and identify at least two non-financial factors that should influence the decision.
3. During construction, a client requests a revised façade finish after procurement has begun. Prepare the main headings and information that should be included in a change evaluation and decision record.

Multiple Choice Questions with Answers

Question 1

Which statement best describes a construction risk?

A. A completed defect that requires correction

B. An uncertain event or condition that may affect project objectives

C. An approved project baseline

D. A guaranteed project cost

Correct Answer: B. An uncertain event or condition that may affect project objectives

Question 2

What is the main purpose of a risk register?

A. To replace the construction programme

B. To record identified risks, assessments, owners, actions and status

C. To authorise all payments automatically

D. To calculate structural loads

Correct Answer: B. To record identified risks, assessments, owners, actions and status

Question 3

A risk has a probability rating of 4 and an impact rating of 3. Using R = P × I, what is its score?

A. 7

B. 12

C. 16

D. 43

Correct Answer: B. 12

Question 4

A risk has a probability of 0.25 and a possible cost of £40,000. What is its expected cost?

A. £1,000

B. £10,000

C. £16,000

D. £40,250

Correct Answer: B. £10,000

Question 5

Which response changes the project method or scope so that a threat no longer applies?

A. Avoid

B. Accept

C. Transfer

D. Monitor only

Correct Answer: A. Avoid

Question 6

Which statement about residual risk is correct?

A. It is risk remaining after responses are implemented

B. It is always zero after approval

C. It applies only to financial risks

D. It is the original risk before assessment

Correct Answer: A. It is risk remaining after responses are implemented

Question 7

Which action should normally occur before significant changed work proceeds?

A. Delete the original drawings

B. Obtain appropriate written authority

C. Ignore the programme effect

D. Close the risk register

Correct Answer: B. Obtain appropriate written authority

Question 8

Why is the critical path important when assessing a change?

A. It identifies the cheapest material

B. It determines whether an activity may affect the completion date

C. It eliminates the need for records

D. It measures worker attendance

Correct Answer: B. It determines whether an activity may affect the completion date

Question 9

Which item is most appropriate for a decision record?

A. Only the preferred option’s price

B. Options considered, assumptions, approval and required actions

C. Unverified rumours from unrelated projects

D. A deleted history of rejected alternatives

Correct Answer: B. Options considered, assumptions, approval and required actions

Question 10

What is an important limitation of an expected monetary value calculation?

A. It cannot use probabilities

B. It guarantees the actual project outcome

C. It depends on the quality of estimated probabilities and consequences

D. It is valid only for safety decisions

Correct Answer: C. It depends on the quality of estimated probabilities and consequences