Qualitative and Quantitative Risk Assessment

QUALITATIVE AND QUANTITATIVE RISK ASSESSMENT IT 313 6-2 Thistle, Cameron SNHU | 03/21/2023 The first step in risk analysis is qualitative analysis, which can help identify the most pressing threats, those that can be dealt with less quickly, and those that should be ignored. To accomplish this, the RA team must classify the probabilities of the risks (from low to extremely high) and evaluate the risks based on the probability using qualifying criteria. Since the scope is the most important factor to stakeholders, it is appropriate to give it more weight. Stakeholder analysis, which reveals where attention ought to be directed, can yield values like these. The stakeholders place a greater emphasis on the project's completion on time, within budget, and in accordance with requirements. If the project is delayed by one month, the risk may have a moderate effect. The risk could be extremely high if it is delayed for more than two months, which could be detrimental to the business. A project that has a very high impact may be deemed unsuccessful, particularly if the given requirements are not met. High-impact or high-probability risks benefit from quantitative analysis. To estimate the project's cost and time frame, the RA team will need to quantify its evaluation. Based on the assumption that the initiative would generate $30 million in annual revenue, the RA team would have to figure out how much money the organization would lose if it did not complete the project. The single loss expectancy (SLE), which in this instance would be $30 million, would need to be estimated. The contracted company stands to lose the most in terms of revenue if the project is not completed on time and meets all necessary security standards. As a result, the company faces less risk. The quality and, consequently, the project's scope could undoubtedly be altered by poorly implemented project requirements. This could impact the general spending plan put away for the venture's finish, especially assuming there is asset squander. If the project is completed on time but without the necessary security, the same holds true. The risks would be minimal or nonexistent and would have little effect on the project's implementation if the project was completed a month early and met all security requirements. If the project is delayed for two months without meeting the necessary security standards, it could fail. The business would suffer greatly because of this. The company is more likely to earn $30 million annually if the project is completed on time, satisfies all security requirements, stays within or on budget, and fails to fulfill the contractual commitment to provide service. A "qualitative risk" refers to this. The contracted company runs the risk of losing anywhere from 5% to 20% of the potential profits from completing the work if it is unable to complete it within the allotted time frame. If the company decides to outsource the project, it is highly unlikely that it will be completed in less than six months. As a result, the effects could be significant. The company may end up paying more to bring in a new team to finish the job. The fact that it is virtually impossible to estimate how much it will cost to successfully complete a project may be the only drawback of qualitative risk assessment. One more likely trap of subjective examination would be that the association wouldn't be aware assuming its expenses are expanding with respect to the possible misfortunes from new dangers.