Discuss the appropriateness of the following risk matrices w

Discuss the appropriateness of the following risk matrices with respect to weak consistency, betweeness, and consistent coloring Redesign the above matrices to conform to Cox\'s requirements

Solution

A Risk is the amount of harm that can be expected to occur during a given time period due to specific harm event (e.g., an accident). Statistically, the level of risk can be calculated as the product of the probability that harm occurs (e.g., that an accident happens) multiplied by the severity of that harm (i.e., the average amount of harm or more conservatively the maximum credible amount of harm). In practice, the amount of risk is usually categorized into a small number of levels because neither the probability nor harm severity can typically be estimated with accuracy and precision.

A Risk Matrix is a matrix that is used during Risk Assessment to define the various levels of risk as the product of the harm probability categories and harm severity categories. This is a simple mechanism to increase visibility of risks and assist management decision making.

Although many standard risk matrices exist in different contexts (US DoD, NASA, ISO),^[1][2][3] individual projects and organizations may need to create their own or tailor an existing risk matrix.

For example, the harm severity can be categorized as:

The probability of harm occurring might be categorized as \'Certain\', \'Likely\', \'Possible\', \'Unlikely\' and \'Rare\'. However it must be considered that very low probabilities may not be very reliable.

The resulting Risk Matrix could be :

Negligible

Marginal

Critical

Catastrophic

Certain

High

High

Extreme

Extreme

Likely

Moderate

High

High

Extreme

Possible

Low

Moderate

High

Extreme

Unlikely

Low

Low

Moderate

Extreme

Rare

Low

Low

Moderate

High

The company or organization then would calculate what levels of Risk they can take with different events. This would be done by weighing up the risk of an event occurring against the cost to implement safety and the benefit gained from it.

The following is an example risk matrix with certain accidents allocated to appropriate cells within the matrix:

Negligible

Marginal

Critical

Catastrophic

Certain

Stubbing Toe

Likely

Fall

Possible

Major Car Accident

Unlikely

Aircraft Crash

Rare

Major Tsunami

Problems with Risk Matrix

In his article \'What\'s Wrong with Risk Matrices?\', Tony Cox argues that risk matrices experience several problematic mathematical features making it harder to assess risks. These are:

	Negligible	Marginal	Critical	Catastrophic
Certain	High	High	Extreme	Extreme
Likely	Moderate	High	High	Extreme
Possible	Low	Moderate	High	Extreme
Unlikely	Low	Low	Moderate	Extreme
Rare	Low	Low	Moderate	High