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How do you categorize a risk and what metrics do you take into account when doing so?

For example (Low, Medium, High). Metrics such as time, budget etc.

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Question added by Tarik Delic , Project Manager , Green River Media
Date Posted: 2015/02/04
Alex Al Yazouri
by Alex Al Yazouri , General Manager , Al Mushref Cooperative Society

I would say use percentages, colors" red, yellow. green" or anyway you like, most important identify it and deal with it in cost, schedule and more.

Kaamila Tahseen
by Kaamila Tahseen , Change Management Team Manager , cognizant technology solutions

We can categorise risks using risk breakdown structure. marking them high medium will be based on cost, schedule and scope baselines , quality is also a metric to be considered.

Ahad Nazir
by Ahad Nazir , Consultant , Sustainable Development Policy Institute

After the initial long list of identified risks, the Organizational risk tolerance among other factors decide what probability or impact rating the risk will be getting. This data is then fed into the probability Impact Matrix to find the Risk Score (Risk Score = Probability x Impact) The risks are then put in the descending order of the risk score and depending on the Organizational Policies and the Project needs, the risks are then sub-divided into High, Medium and Low Priority Risks. PMI calls this process "Perform Qualitative Risk Analysis". After the prioritization only the few very high scoring risks are made part of the detailed and costly (both in terms of cost and time) quantitative risk analysis. 

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