ARM - Associate in Risk Management Risk Identification and Analysis Questions and Answers — Questions and Answers
Question 1: A risk manager is using a risk analysis technique that starts with a top-level event (e.g., system failure) and deductively works backward to identify all the potential underlying causes. This technique uses logic gates like 'AND' and 'OR' to model the relationships between events. Which risk analysis technique is being used?
- Event Tree Analysis (ETA)
- Fault Tree Analysis (FTA) (Correct answer)
- Bow-Tie Analysis
- SWOT Analysis
Correct answer: Fault Tree Analysis (FTA)
Fault Tree Analysis (FTA) is a top-down, deductive failure analysis where a system's potential failure is traced back to its root causes. It uses Boolean logic to show how component-level failures can lead to a top-level undesired event. [3, 6, 11]
Question 2: A manufacturing company is conducting a comprehensive risk identification process. The risk management team decides to analyze the company's internal capabilities, such as its skilled workforce and proprietary technology, as well as external factors like new market entrants and changing regulations. Which of the following identification tools is best suited for this type of analysis?
- Checklists and Questionnaires
- SWOT Analysis (Correct answer)
- Incident Analysis
- Process Flow Analysis
Correct answer: SWOT Analysis
SWOT Analysis is a strategic planning technique used to identify Strengths, Weaknesses, Opportunities, and Threats related to a project or business venture. It is ideal for evaluating both internal (Strengths, Weaknesses) and external (Opportunities, Threats) factors. [22, 27, 28]
Question 3: Which of the following is a key characteristic of Event Tree Analysis (ETA)?
- It is a 'top-down' deductive approach.
- It primarily focuses on identifying the root causes of a past event.
- It graphically represents the consequences of a single initiating event. (Correct answer)
- It combines the causes and consequences of an event in one diagram.
Correct answer: It graphically represents the consequences of a single initiating event.
Event Tree Analysis (ETA) is an inductive, 'forward-looking' method that starts with an initiating event and explores the various possible outcomes or consequences by analyzing the success or failure of subsequent safety functions or events. [3, 6, 9]
Question 4: A risk manager for an airline wants to create a single, comprehensive diagram to visualize a specific high-consequence risk, such as an engine failure. The diagram should show the potential causes (threats) on the left, the critical event in the center, and the potential consequences on the right, along with the preventative and mitigating controls. Which analysis method would be most appropriate?
- Fault Tree Analysis (FTA)
- Root Cause Analysis (RCA)
- Bow-Tie Analysis (Correct answer)
- Failure Mode and Effects Analysis (FMEA)
Correct answer: Bow-Tie Analysis
Bow-Tie analysis is a visual risk assessment tool that combines elements of Fault Tree Analysis (left side, for threats/causes) and Event Tree Analysis (right side, for consequences) into a single diagram. The 'knot' in the middle represents the critical event or hazard. [7, 12, 14]
Question 5: A project team is creating a risk register for an upcoming software development project. Which of the following pieces of information is LEAST likely to be included for each identified risk in the initial risk register?
- A description of the risk.
- The probability and potential impact of the risk.
- The name of the assigned risk owner.
- The detailed, step-by-step mitigation plan. (Correct answer)
Correct answer: The detailed, step-by-step mitigation plan.
While a risk register documents identified risks, their probability, impact, and owner, the detailed, step-by-step mitigation plan is typically developed as part of the risk response planning phase, after the initial identification and analysis. The register might initially note the response strategy (e.g., avoid, mitigate, transfer, accept), but the full plan comes later. [16, 17, 23]
Question 6: A risk manager at a chemical processing plant needs to analyze the potential outcomes following a specific initiating event, such as a valve failure. The goal is to understand the sequence of events and the effectiveness of safety barriers in preventing a major incident. The analysis should proceed forward in time from the initial failure. Which technique is most suitable for this purpose?
- SWOT Analysis
- Fault Tree Analysis (FTA)
- Event Tree Analysis (ETA) (Correct answer)
- Brainstorming
Correct answer: Event Tree Analysis (ETA)
Event Tree Analysis (ETA) is the appropriate technique here because it is an inductive method that works forward from an initiating event to explore all possible outcomes based on the success or failure of safety systems and barriers. [3, 6, 9]
ARM - Associate in Risk Management Risk Identification and Analysis Questions and Answers
A risk manager is using a risk analysis technique that starts with a top-level event (e.g., system failure) and deductively works backward to identify all the potential underlying causes.
This technique uses logic gates like 'AND' and 'OR' to model the relationships between events.
Which risk analysis technique is being used?