Let’s say you own a healthcare service business, and you notice a sudden drop in the number of customers. Take a few steps back, and pretend that you’re an observer who is not emotionally tied to the situation. Step 1: Step Back and Use Logicįirst, consider your problem from a big-picture perspective. There are 6 steps I recommend when using this tool. Severe (a score of 10 to 16) - Rapid action is requiredĬritical (a score of 20 to 25) - Immediate, crucial priority Serious (a score of 3 to 6) - Active monitoringĭisruptive (a score of 8 to 9) - Investigation needed This number is associated with a 5-level scoring result (Controlled, Serious, Disruptive, Severe, or Critical).Ĭontrolled (a score of 1 to 2) - Limited monitoring only Our scoring is done when we select a level of Impact (1 to 5), and a level of probability (1 to 5).Ī score is determined by the product (multiplication) of the two numbers. This is done using a numbered scoring method and color-coded indicators. We can use this tool to calculate whether negative outcomes will happen, and if so how destructive the effects could be. Strategic Risk Severity Matrix (Probability circled) How to Use the Strategic Risk Severity Matrix Frequent - Likely to occur soon and often ( the highest Probability). Unlikely - Not expected to occur ( the lowest Probability).Probabilitygoes from Low (at the bottom left) to High (bottom right): On the bottom are the Probability factors, which is how we rate the likelihood that the event will happen. Strategic Risk Severity Matrix (Impact circled) Catastrophic - Risks will cause extensive damage and long-term effect ( the highest Impact).Major - Risks will cause significant loss, injury, or damage.Serious - Risks may cause considerable loss, injury, or damage.
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