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Project Risk Management and Decision Analysis

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Risk Weighting


Risk Weighting is a method of assigning the relative importance of a particular risk category to an organization and is important when dealing with multi-criteria decision-making. RiskyProject uses a form of the Analytical Hierarchy Process (AHP) to weigh the relative importance of on risk category over another.
 

AHP is a three-step process:
1. Develop a list of your risk categories and criteria.
2. Perform a pair-wise comparison to establish consistent ranking or priorities for each risk categories.
For example, after determining your organizations risk preferences, you determine that Cost risk is twice as important as Schedule; you would enter in a 2 in the cell where the Cost category row intersects the Schedule column.



The resulting weighting is Cost and Income 2.0 and Schedule 0.5. Notice that the relative importance of the Risk Category has increased to 13.8 while the rest of the categories have decreased:


3. These weights will be used in calculation of risk impact on all categories.


  You may copy risk outcome data to the clipboard. To do it select a row under which you want to add a copy risk outcome, right-click on the row number and choose Copy Item.
  Risk outcomes, categories and weights can be saved to the registry and serve as defaults for all future projects. To do it use Set as default button of risk Outcome dialogs. If you modify a risk category and want to restore the defaults saved in the registry, click the Restore Defaults button.
  By default, weights for all risk categories are equal.


 

See also

Adding risk categories

Risks in RiskyProject

Risk Register

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