Likelihood and Impact Models

A likelihood model expresses the chance that circumstances defining a risk will actually occur. An impact model expresses the potential loss associated with the risk.

Each consists of labels (such as Low, Medium, or High) that correspond to numeric values. The models may be qualitative or semiquantitative.

Qualitative Models

As you create a qualitative likelihood or impact model, you compose the labels you want to use. You associate each with a number from 1 to 10, although you don't have to use all ten values. The higher the number, the greater the threat. For each label-number pairing, you can also provide a description of the label.

A user who initiates a qualitative analysis selects one likelihood label and one impact label. Each model supplies the corresponding numeric value to a qualitative analysis model, which multiplies the numbers to calculate an overall risk score.

Semiquantitative Models

As you create a semiquantitative likelihood or impact model, you compose the labels you want to use, and you associate each with a numeric range. The ranges you create must use all values from 1 to 100, with no gaps or overlaps. Once again, a higher number indicates a greater threat. For each label-range pairing, you can also provide a description of the label.

A user who initiates a quantitative analysis enters a number for each of likelihood and impact. Each of these numbers is included in one of the ranges defined by a semiquantitative model, which returns the label associated with that range. These labels are included among analysis results. Also, the numbers entered by the user contribute to an overall risk score calculated by a quantitative analysis model.