Explain each of the following steps in risk evaluation and remediation.

• Risk identification
• Risk evaluation for chance of occurrence
• Risk evaluation for impact if the risk takes place.
• The four types of risk remediation,
• What is a project risk owner,
• What is a risk threshold.
• What is a risk matrix.

Answer:

Risk identification.

Risk identification is the process of determining risks that might potentially hinder the program, business or investment from accomplishing its goals.

It comprises documenting and communicating the concern.

Risk evaluation for chance of occurrence.

The risk evaluation is a two-stage assessment process.

The probability is the likelihood of an event occurring and the results, to which extent the project is affected by an event.

By combining the probability and effects, the level of risk can be determined.

Risk evaluation for impact if the risk takes place.

The probability assessment includes estimating the likelihood of a risk occurring.

The impact assessment estimates the impacts of a risk event on a project goal.

These impacts can be both positive and negative for example opportunities and threats.

The four types of risk remediation.

They include the following;

Risk avoidance.

Acceptance.

Transference.

Limitation.

Generally, risks should be avoided that involve a high probability impact for both financial loss and damage.

What is a project risk owner.

A project risk owner is the person who is responsible for monitoring the risks, selecting and implementing an appropriate risk response strategy.

However, these individuals may aid in evaluating their risks in performing qualitative risk analysis and the quantitative risk analysis.

What is a risk threshold.

The risk threshold refers to a project management tool to measure the degree of uncertainty and the level of effects which a stakeholder or organization may have interest.

Generally, it is the amount of risk that organizations and stakeholders are willing to accept.

What is a risk matrix.

Risk matrix is one of the most widespread tool for risk evaluation.

They are mainly used to determine the size of a risk and whether or not the risk is sufficiently controlled.