PMI RISK PROBABILITY IMPACT MATRIX FULL

Timing – defines when and how frequently the risk management processes will be performed. Roles and Responsibilities – Defines who will be responsible for each type of activity described in the risk management plan.įunding – Identifies the funds needed to perform activities related to project risk management and describes any contingency and management reserves. Methodology – Defines the specific approaches, tools, and data sources that will be used to perform risk management on the project. Risk Strategy – Describes the general approach to managing risk on this project. It can be its own stand-alone document or a sub-section in the project management plan. This document describes how the risk management process will be tailored and undertaken for the project. For example, a 10% cost overrun is acceptable, but anything above that is not.Īn output of the Plan Risk Management process is the (imaginatively named) Risk Management Plan. The measure of acceptable variation around an objective that reflects the risk appetite of the organization and stakeholders. Risk Threshold (used to be called Risk Tolerance).

PMI RISK PROBABILITY IMPACT MATRIX FULL

Others are happy to pursue a variety of initiatives knowing full well only a small percentage will be successful. Some organizations have a low appetite for risk and prefer to pursue low-risk endeavors. The amount of uncertainty an organization or person is willing to accept in anticipation of a reward. For example, if you travel from Boston to New York and you delayed on 30 min it may be acceptable, however it you delayed on 1, 2 or more hours, it is a serious impact to your schedule, and you should avoid such risks.For example, the risk management process we create for a 6-person team erecting a big-top tent one afternoon will have a different level of detail and rigor than a 300-person project to develop and test a medical device over 18 months.

In particular, higher impacts are associated with larger intervals.

In many cases, the intervals for numerical scales are nonlinear.

In addition, you can use the overall rank indicators for objectives that don’t require specific intervals.

However, you only have to do this once and it can be used for all of our projects. As a result, an organization may need to define many interval names for multiple objectives, for impacts and probabilities, and for threat sand opportunities. For example, the safety interval definition requiring hospitalization may not be suitable for opportunities (unless this is Department of Defense project related to the outcomes of battle tactics). You should define and name intervals separately for threats and opportunities.Please note a few important things about risk matrixes: Below we have an example of probability and impact numerical scales and labels for selected impact types: The label of interval will be shown on risk matrix, but it can be used when you when you enter probabilities and impacts for a certain risk belonging to certain impact type. Probability and Impact labels and numerical value of each interval.Number of intervals for probabilities and impact.Here are the important parameters of the risk matrix that must be defined: Risk matrixes can be setup up for an entire organization or for a specific program. It is also possible to show total number of risks associated with each cell of risk matrix. It is also possible to changes in risk probability and impact during the course of the project.

Risk matrix may include arrows, which represent probability and impact of risk after mitigation. For example risks in red cells should be avoided, risk in yellow cells should be mitigated, and risks on green cells can be accepted. The heat map provides a quick visual assessment of risk criticality and assists in the prioritization of risk response handling. Risk severity is often visualized using a heat map the overlays the matrix, with cells with risk scores that are critical red, medium in yellow, and low in green. For example a risk with a probability of 4 and impact of 4 would have a score of 4 x 4 = 16. Commonly, on a risk matrix each row and column is assigned a numeric value from 1-5 (on a 5×5 matrix) with one being the lowest and five being the highest The risk score is calculated is the probability score multiplied by the impact score. Risk Matrixes are used to assess risk severity based on where the risk’s assessed probability and impacts intersect on the risk matrix. Risk matrix usually has cells associated with different ranges of probability and impact. A risk matrix is a project management tool that allows a single page – quick view of the probable risks evaluated in terms of the severity or impact or risk and likelihood or probability of the risk plotted the x and y axis.

Pmi risk probability impact matrix