$$ In response, comment on whether you agree or do not agree with the identified risks and plans for mitigation or avoidance.

There are several risks regarding the textbook example of Sheila and Bill buying a car for their daughter Abby. One of the first risks is purchasing a used car and finding out that it has many mechanical problems or has been in an accident. To mitigate this risk, they could bring the car to their trusted mechanic and thoroughly inspect it or buy a new car. The family decided on a new car as a migration strategy. But in buying the new Toyota Prius, there may be risks they have yet to consider. The exact vehicle Abby wants may not exist at this time. The family may have to wait longer for the exact car, or the dealer will find a similar car that exists but is slightly different from the one that Abby wants. Another risk is the loan charges being higher than expected. These are some of the risks of buying a new car.

The mechanical risk has been mitigated by shopping for new cars. To mitigate the risk of the exact car not being available, find what car is available and try to get that one. Bill and Sheila should shop at several lending companies to mitigate the risk of extra loan fees and become familiar with their loan programs and interest rates. The procurement plan needs a strategy for mitigating risks and a contingency plan if the risk occurs. The contingency plan may require some adjustments to the procurement plan.

Risk identification and planning will contribute to the success of the procurement. Risks are considered known unknowns because the buyer is aware that they can exist but is unaware if they exist. A risk plan that considers mitigating the risk and contingent action if the risk appears will make a much smoother and more successful procurement.