Author Topic: Learning to Prioritize Risks  (Read 1285 times)

bbasujon

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Learning to Prioritize Risks
« on: April 17, 2017, 07:13:24 AM »
How to Use the Tool

The Risk Impact/Probability Chart is based on the principle that a risk has two primary dimensions:
Probability – A risk is an event that "may" occur. The probability of it occurring can range anywhere from just above 0 percent to just below 100 percent. (Note: It can't be exactly 100 percent, because then it would be a certainty, not a risk. And it can't be exactly 0 percent, or it wouldn't be a risk.)

Impact – A risk, by its very nature, always has a negative impact. However, the size of the impact varies in terms of cost and impact on health, human life, or some other critical factor.

The chart allows you to rate potential risks on these two dimensions. The probability that a risk will occur is represented on one axis of the chart – and the impact of the risk, if it occurs, on the other.

https://www.mindtools.com/pages/article/newPPM_78.htm