Gary has identified a project risk that could injure project team members. He does not want to accept any risk where someone could become injured on this project so he hires a professional vendor to complete this portion of the project work. This workaround to the risk event is known as what type of risk response?

A.
Acceptance

B.
Transference

C.
Mitigation

D.
Avoidance

Explanation:

Transference is a strategy to mitigate negative risks or threats. In this strategy, consequences and the ownership of a risk is transferred to a third party. This strategy does not eliminate the risk but transfers responsibility of managing the risk to another party. Insurance is an example of transference. When Gary

hires a professional vendor to manage that risk, the risk event does not go away but the responsibility for the event is transferred to the vendor.
Answer option D is incorrect. Avoidance removes the risk event entirely either by adding additional steps to avoid the event or reducing the project scope requirements.

Answer option C is incorrect. Mitigation are actions Gary’s project team could take to reduce the probability and/or impact of a risk event.
Answer option A is incorrect. Gary is not accepting this risk event, he does not want anyone on his team to become injured so he’s transferring the event.
Reference: Chapter 11. A Guide to the Project Management Body of Knowledge, (PMBOK Guide), Fourth Edition, ISBN.9781933890517, Section 11.5.2.1.