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Three factors which need to be assessed while considering risks are urgency, impact and likelihood. Define what is meant by every of these terms and demonstrate how each might be assessed.
Likelihood consider as the probability of the risk happening. This can be expressed in percentage terms or, almost, as either low, medium or high.
Impact (i.e., strictly, scale of impact) consider as the size of the ‘hit’ the project would take when the risk occurred. This can be assessed numerically (for illustration, a 10 percent increase in timescale or cost) or as either huge, moderate or small.
Urgency has two aspects, consider as the time while the risk will arise (when it does) and the ‘window of opportunity’ accessible to deal along with this. Urgency can be expressed into time terms (that is one month, for illustration) or simply like ‘very urgent’, ‘urgent’, ‘less urgent’.
The manager of a movie production company is thinking of investing in new graphics computers for a price of $325,000. The computers are expected to have a useful life of 3 years.
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