How do you evaluate risk in a public procurement project?

• A. Ignore any low-probability risks to save time
• B. Focus solely on cost
• C. Identify events, assign probability and impact, calculate risk score, and prioritize mitigation actions
• D. Delay risk assessment until project ends

Answer: (C)

Evaluating risk in a public procurement project starts with identifying events that could affect objectives such as cost, schedule, performance, or compliance. For each event you estimate how likely it is and how big the impact would be. By combining probability and impact into a risk score, you can rank which risks matter most and tailor mitigation actions accordingly. This approach lets you allocate resources to the highest-priority risks and put proactive measures in place, such as contingency planning, contract clauses, supplier monitoring, or alternative sourcing strategies. In public procurement, this structured assessment also supports transparency and accountability, making it easier to justify decisions to stakeholders and regulators.

Ignoring low-probability risks wastes preparedness; focusing only on cost ignores schedule, quality, and regulatory or contract risks that can derail a project. Delaying risk assessment until the project ends eliminates opportunities to prevent problems or reduce their impact.