11.3 Perform Qualitative Risk Analysis

Up one level

"The process of prioritising risks for further analysis or action by assessing and combining their probability of occurrence and impact."

The definition shown above in italics is taken from the Glossary of the Project Management Institute, A Guide to the Project Management Body of Knowledge, (PMBOK® Guide) – Fifth Edition, Project Management Institute Inc., 2013

Project Management Institute, A Guide to the Project Management Body of Knowledge, (PMBOK® Guide) – Fifth Edition, Project Management Institute Inc., 2013 Figure 11-8 Page 328

Perform Qualitative Risk Analysis

Prioritize risks for further analysis or action
Assess quality of risk data
Examine Risk Categories
Update Risk Register
Ranking
- To evaluate the overall risk ranking for the project
- To produce a list of prioritised risks

Qualitative tools:

Probability / impact risk rating matrix
Intuition / expertise
Scoring scales e.g.1 to 5; high-medium-low
Definitions of their meaning
Risk Urgency – those requiring near term responses
Can be combined with Ranking to give a final severity rating

Qualitative Risk Analysis Example

Probability Analysis
Category	Qualitative	Quantitative
A - Very high	Repeated incidents that could occur several times in the operating life of the facility	Probability of 1 event in 100 plant years or a frequency equal to 1 x 10² or greater
B - High	Isolated incidents that could occur limited times in the operating life of the facility	Probability of 1 event in 1000 plant years or a frequency equal to 1 x 10^-2 to 1 x 10^-3
C - Marginal	An incident occurring sometimes in similar or like facilities elsewhere in the world	Probability of 1 event in 10,000 plant years or a frequency equal to 1 x 10^-3 to 1 x 10^-4
D - Low	An incident that has occurred more than once in similar or like facilities	Probability of 1 event in 100,000 plant years or a frequency equal to 1 x 10^-4 to 1 x 10^-5
E - Very Low	Rare incident that has been heard of occurring in similar facilities	Probability of 1 event in 1,000,000 plant years or a frequency equal to 1 x 10^-6 or lesser.

Risk reduction of hazardous chemical releases

Source: http://www.safetyonline.com/doc.mvc/RISK-BASED-APPROACH-FOR-HAZARD-DETECTION-Fire-0001

Presenting the Results

Method One – Tabular

Method Two – Graphical

Probability Impact Grid

Risks with low or moderate ratings are:

taken direct to Plan Risk Responses,
put onto a Watchlist to watch for changes
are typically not analyzed quantitatively

Probability Impact (P-I) Matrix