Develop Risk Assessment Criteria

Typically, the first step in the risk management process is to develop Risk Thresholds and Risk Matrixes.

A risk threshold is a range of values used to assess a project or program's tolerance for risk. It is used to create a risk matrix, the overall scoring mechanism used to perform qualitative and quantitative risk analyses.

A risk matrix is an analysis tool used to calculate the impact of a risk and is required to perform a qualitative risk analysis on a project or program or a quantitative risk analysis on a project. It includes probability threshold values, cost and impact threshold values, and any additional user-defined impact threshold values. These are all used to calculate risk.

Risk thresholds and matrixes are configured in the workspace settings. You can define separate risk matrixes for projects and programs. Risk matrixes are then assigned in the project or program settings. These processes are described in Get Started with Risk.