Eric is the project manager of the MTC project for his company. In this project a vendor has offered Eric a sizeable discount on all hardware if his order total for the project is more than $125,000. Right now, Eric is likely to spend $118,000 with vendor. If Eric spends $7,000 his cost savings for the project will be $12,500, but he cannot purchase hardware if he cannot implement the hardware immediately due to organizational policies. Eric consults with Amy and Allen, other project managers in the organization, and asks if she needs any hardware for their projects. Both Amy and Allen need hardware and they agree to purchase the hardware through Eric’s relationship with the vendor. What positive risk response has happened in this instance?

A.
Exploiting

B.
Transference

C.
Sharing

D.
Enhancing

Explanation:

This is an example of sharing the positive risks so that all parties involved in the decision can benefit from the purchase and discount of the hardware.

Sharing response is where two or more entities share a positive risk. Risk sharing deals with sharing of responsibility and accountability with others to facilitate the team with the best chance of seizing the opportunity. Teaming agreements are good example of sharing the reward that comes from the risk of the opportunity.

Answer option D is incorrect. Enhancing is a tempting choice as Eric is enhancing the probability of receiving the discount from the vendor, but he is sharing the opportunity to receive the discount – something he would not receive on his own.

Answer option A is incorrect. Exploiting happens when the project manager wants to ensure that an opportunity is realized. Eric is certain that
Amy and Allen will be purchasing the hardware.

Answer option B is incorrect. Transference is a negative risk response that transfers ownership of a risk event to a third party, such as a vendor.

Reference: "Project Management Body of Knowledge (PMBOK Guide), Fourth Edition"