How to Rank Probability & Impact Matrix
- 1). Create a simple graph with a y and x axis, placing the probability of a risk occurring as the x axis of the graph. For the purposes of this exercise, probability can be anything from a “1 to 10” ranking to “1% to 99%” to “'not likely' and 'you bet.'” Label the y axis as the risk impact section of the graph. Again, the ranking system can be a simple “1 to 10” or something more arbitrary, like “'hardly noticeable' to 'catastrophic.'”
- 2). Assign a value for each risk's probability and impact, using the project risk assessments, then place the project's risks at the appropriate sections of the graph. High probability, high impact risks should appear in the upper right portion of the graph, while low probability, low impact risks will appear in the lower left portion. Visualizing the probability and impact matrix as a graphical entity allows for reasoned action to eliminate or mitigate potential risks in order of importance.
- 3). Address those risks in the upper right corner of the graph first. Having the greatest likelihood of happening and the greatest impact upon a project, they are the most important risks and will require the greatest amount of effort to mitigate. Risks with high impact and low probability, or high probability and low impact, should be addressed secondly. Risks with low probability and low impact may often be ignored, or simply dealt with when and if they actually arise.
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