Calculate risk probability and risk impact

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Reference no: EM131650030

Please give me a 200 word synopsis for this dissucussion and what you think about it.

According to the IBM Knowledge Center, risk indices are used to calculate risk probability and risk impact. Their website states:

"Risk Index: The risk index is the overall result of a risk assessment. All indicators and indexes can be used in the calculation for the risk index. It is a composite of the likelihood and impact index.

Likelihood: The likelihood index shows the probability of a risk event occuring. This is measured in percentage. All indicators of a risk assessment can be used to calculate this index.

Impact: The impact index shows the impact a risk event has on the company. This is measured by an abstract value range. All indicators of a risk assessment can be used to calculate this index" (IBM, 2017).

Potesta, the engineering and environmental firm that I am investigating for my project, could benefit from risk indices. It takes a very mathematical approach by using a formula to calculate risk. This would appeal to this STEM based company. It would help them identify the major types of risks to their business such as the economy, major environmental disasters, and office equipment failures. Since the firm's projects are based on areas of economic growth, it would be good to calculate out the risks.

Reference no: EM131650030

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