Risk based matrices are tools to help assess and manage risk. They provide an organized way to identify, analyze, and prioritize risks. By using a risk based matrix, organizations can make better decisions about how they allocate resources and take proactive steps to reduce risks.
What is a Risk Based Matrix?
A risk based matrix is a table that identifies potential risks associated with a project or activity. The table contains columns for the estimated probability of each risk happening, the potential impact if it does happen, and recommended actions for managing the identified risks. Each row in the table represents one type of risk and its associated data points such as probability of occurrence and potential impact if it happens.
How Does It Work?
Organizations use the data from their risk based matrix to evaluate how likely certain risks are to occur as well as how severe their potential impacts might be should they occur. Once these assessments have been made, organizations can prioritize which risks need immediate attention or further investigation in order to minimize any negative impacts on their operations or projects. This allows them to allocate resources where they’re most needed in order to reduce any financial losses or other disruptions due to unforeseen events.
