In risk responses, what is the difference between mitigation and contingency plans?

• A. Mitigation reduces probability or impact; contingency plans specify actions if a risk event occurs.
• B. Mitigation eliminates risk entirely; contingency plans allocate budget.
• C. Contingency plans reduce probability; mitigation acts after risk occurs.
• D. Both reduce probability to zero.

Answer: (A)

Mitigation is about reducing the chance that a risk will occur or reducing the impact if it does. It’s proactive work you do to lower the probability or the severity of a potential problem before it happens, such as diversifying suppliers, adding redundancy, increasing testing, or redesigning processes to be more robust.

A contingency plan, on the other hand, is a predefined set of actions to take if the risk event actually occurs. It’s a ready-to-activate response that describes who does what, when, and with what resources to recover or continue the project after the risk has materialized. It doesn’t try to prevent the event; it prepares for managing its consequences.

These ideas work together: mitigation aims to prevent or lessen the risk, while the contingency plan provides a structured response if prevention isn’t enough. For example, if supplier delay is a risk, mitigation might involve dual sourcing to reduce likelihood or impact, while the contingency plan would specify switching to an alternate supplier and expediting orders if a delay happens.