This lesson focuses on the types of risks and the characteristics that accompany those risks:
- Pure Risk: the kind of risk you can get insurance for (i.e. flood and fire insurance)
- Business Risk: cannot be insured (i.e. Not receiving the amount of sales projections you'd expected).
- Uncertainty: Taking what you know about a topic and seeing what risks are involved
There are three types of risk takers: - Risk seeker: someone who enjoys risk
- Risk adverse: avoid risk at all costs
- Risk neutral: could go either way, middle ground
[toggle_content title="Transcript"] I want to go over three types of risks. There is pure risk, business risk, well, this is not a type of a risk but its uncertainty. Pure risk is risk that you can get insurance for. Flood insurance, fire insurance...anything that you can insure is considered a pure risk. A business risk is not insurable. Business risk is not receiving the amount of sales projections that you are expecting. Uncertainty is taking the knowns and the unknowns and trying to figure out how much do you know about a topic. Uncertainty could be like there are a lot of unknowns about it and you won't face it until you get on to the project. When dealing with risks, you have to understand there are three types of risk...risk characteristic. Risk seeker, risk averse and risk neutral. A risk seeker, to me who I think about a risk seeker is Richard Branson. Someone who is willing to take risks and they enjoy it. They are go after those types of projects. Risk averse, they avoid risks at all costs. Think of it like, companies that are not willing to take a risk for example going overseas. There might be a lot of money to be made overseas but there is a risk associated with that and they are going to avoid it at all costs. Risk neutral, they can go either risk seeker or risk averse. They are middle ground so depending on what the situation on the ground is that is how they are going to seek out risks. [/toggle_content]
Project Management Professional (PMP) - PMI
Our online PMP training course educates on how to initiate, plan and manage a project, as well as the process behind analyzing risk, monitoring and controlling project contracts and how to develop project schedules and budgets.