Concepts
When preparing for the Project Management Institute Risk Management Professional (PMI-RMP) exam, understanding tools that can effectively help to visualize and manage project risks is of paramount importance. Among these tools, the risk burndown chart and dot plots feature quite prominently.
1. Risk Burndown Chart
A risk burndown chart is a simple, effective, and visual tool for risk management that provides insights on managing uncertainties in a project. It measures and tracks the reduction of risk over time or throughout the project’s life cycle.
The task of a risk burndown chart is making variations visible. It plots the total risk score against time, allowing you to see at a glance if your overall risk is increasing or decreasing.
Example of Risk Burndown Chart:
Suppose you are managing a software development project. At the start, you identify 10 risks with varying degrees of impact and likelihood. You calculate a total risk score for these (for instance, 500). Each week, as you mitigate risks or they no longer apply, you recalculate the total score. Plotting these scores over time gives you your burndown chart.
Let’s consider the following table:
| Week | Total Risk Score |
|---|---|
| 1 | 500 |
| 2 | 450 |
| 3 | 400 |
| 4 | 350 |
| 5 | 300 |
| 6 | 250 |
| 7 | 200 |
This table, when transformed into a graph, forms the risk burndown chart. An ideal chart would show a downward curve, indicating that risks are being effectively dealt with over time.
2. Dot Plots
In contrast to risk burndown charts, dot plots are graphical tools for organizing and comparing small sets of data. They display individual points (risks) that are distributed along a number line. Each dot represents a distinct item or event.
Dot plots are especially effective in comparing data between different categories of risks. They can also reveal patterns or trends within data such as the concentration, gaps, or outliers.
Example of Dot Plots:
Let’s consider a project where you have identified several risks categorized into three main categories:- Technical, Economic, and Environmental. To each of these risks, you assign a score from 1─10 based on severity.
A dot plot of these scores helps visualize the severity of risks within each category. For instance, you may find that while you have many technical risks, they are all low-scoring. Conversely, you might have only a few economic risks, but they are high-scoring.
Your dot plot would look something like this:
Technical: 1 … 3 … (dot) … 5 … (dot dot) … 7 … (dot) … 10 …
Economic: 1 … 3 … … … 5 … … 7 … (dot dot) … 10 …
Environmental: 1 … 3 … (dot dot) … 5 … … 7 … … … 10 …
This provides a visual representation of your risks and can help guide your risk management activities to ensure that you are focusing on the right areas.
In Conclusion:
Both risk burndown charts and dot plots provide project managers with powerful, visual tools to understand and manage project risks better. When used effectively, these tools can help mitigate risks and increase project success. It is essential for anyone preparing for the PMI-RMP exam to have a robust understanding of and be able to use these diagrams.
Answer the Questions in Comment Section
True or False: A risk burndown chart is specifically used to track the decrease in risks throughout the course of a project.
- True
- False
Answer: True
Explanation: This is true. The primary purpose of a risk burndown chart is to keep track of the reduction in risks as a project progresses.
Single Select: Which of the following does not typically feature on a risk burndown chart?
- a. Remaining risks
- b. Completed tasks
- c. Burned risks
- d. Identified risks
Answer: b. Completed tasks
Explanation: Risk burndown charts primarily focus on risks and issues. They do not generally highlight completed tasks.
True or False: Dot plots are used to show the relationship between two numerical variables.
- True
- False
Answer: False
Explanation: This is false. Dot plots are used to display the frequency of different categories of qualitative data, not to show relationships between numeric variables.
Multiple Select: What kind of information can a dot plot provide?
- a. The amount of data
- b. The middle of the data
- c. The spread of the data
- d. The outliers in the data
Answer: a. The amount of data, c. The spread of the data, d. The outliers in data
Explanation: Dot plots can provide all this information – the count or amount of data, the distribution or spread of the data, and the outliers in the data.
Single Select: In a dot plot, what does each dot represent?
- a. An outlier
- b. A data category
- c. An individual data point
- d. A numerical variable
Answer: c. An individual data point
Explanation: Each dot in a dot plot represents an individual data point.
True or False: A risk burndown chart can also show the potential impact of remaining risks on the project timeline.
- True
- False
Answer: True
Explanation: This is true. A risk burndown chart not only tracks the decrease in risk but also highlights the potential impact of any remaining risks on the project timeline and deliverables.
Single Select: What is the main component of a risk burndown chart?
- a. Work breakdown structure
- b. Risk list
- c. Project timeline
- d. Cost estimates
Answer: b. Risk list
Explanation: A risk list, indicating all identified risks along with their status, is the main component of a risk burndown chart.
True or False: Dot plots are useful for large data sets.
- True
- False
Answer: False
Explanation: This is false. Dot plots are most useful for small to moderate-sized data sets, not large ones.
Multiple Select: Which of the following is true about risk burndown charts?
- a. They show the rate at which risks are being addressed and closed
- b. They indicate the potential impact of remaining risks
- c. They reflect the team’s capacity to manage risks
- d. They illustrate the specific types of risks present
Answer: a. They show the rate at which risks are being addressed and closed, b. They indicate the potential impact of remaining risks, c. They reflect the team’s capacity to manage risks
Explanation: All are true about risk burndown charts except for d. They do not illustrate the specific types of risks present.
True or False: Dot plots can only be used for quantitative data.
- True
- False
Answer: False
Explanation: This is false. Dot plots can be used for both qualitative and quantitative data.
Single Select: Which of the following is not a benefit of using a risk burndown chart?
- a. It gives a visual representation of risk management progress over time.
- b. It helps stakeholders understand the status of identified risks.
- c. It provides detailed information about each individual risk.
- d. It reflects how project risks impact the project schedule.
Answer: c. It provides detailed information about each individual risk.
Explanation: While risk burndown charts are beneficial for seeing overall risk management progress and how risks affect the schedule, they typically don’t provide detailed information about individual risks.
True or False: Dot plots are a form of pie chart.
- True
- False
Answer: False
Explanation: This is false. Dot plots are a separate type of graph used to depict frequency distributions, different from pie charts.
Loved the detailed explanation on the risk burndown chart, it really cleared things up for my PMI-RMP exam prep!
Fantastic post! The example on dot plots was particularly insightful.
Can anyone explain how a risk burndown chart differs from a typical project burndown chart?
Thanks for the great insights, they are really useful for my PMI-RMP exam prep.
Is it possible to get a downloadable template of a risk burndown chart?
Just a small critique, I found the explanations a bit too technical for beginners.
I found the section on how dot plots are used in risk analysis extremely helpful. It’s all starting to make sense now!
As an experienced PM, I found the risk burndown chart methodology to be quite useful for visualizing the risk reduction over project phases.