From the Risk Management Plan, we summarize this information:
There are 6 categories for allocating risk:
- Technical Risk - The degree of uncertainty in the development and deployment process that may keep the system from meeting its technical specifications or that may result in the system being unsuitable for its intended use.
- Cost Risk - The degree of uncertainty associated with system life cycle budgets and outlays that may negatively impact the program causing budget estimates to be exceeded.
- Schedule Risk - The degree of uncertainty associated with the ability of the program to achievedesired milestones (outcomes) on time.
- Programmatic Risk - The degree of uncertainty associated with obtaining and using applicable resources and activities that are outside of the program's control, but can affect the program'
- Operational Risk - The degree of uncertainty in the development and deployment process that may keep the system from being operational in a timely manner to meet current and future operational need
- Support Risk - The degree of uncertainty associated with the ability of the support organization
to augment, change, and maintain the fielded system within the planned support concepts and
The terms for risk likelihood (What is the likelihood the risk event will happen?) are:
- 1 Remote
- 2 Unlikely
- 3 Possible
- 4 Probable
- 5 Near Certainty
The table for consequence criteria within each category (read down within your category column until you find the appropriate consequence if this risk event happens, then look to the left for the risk level) is:
|Level||Technical||Program Schedule||Program End Cost||Operational||Programmatic|
|1||Minimal Impact||Minimal impact||Minimal impact||Minimal Impact||Minimal Impact|
|2||Acceptable with some reduction in capability||Additional resources required; able to meet need dates||< 1%||Small increase in operational costs||Small impact on cost, schedule or technical baselines|
|3||Acceptable with significant reduction in capability||Moderate slip in key milestones; not able to meet need dates||1 - 5%||Moderate increase in operational costs||Moderate impact on cost, schedule or technical baselines|
|4||Marginally Acceptable, barely able to perform needed science||Major slip in key milestone or critical path impacted||5 - 10%||Significant increase in operational costs||Significant impact on cost, schedule or technical baselines|
|5||Unacceptable||Cannot achieve key team or major program milestone||>10%||Unacceptable increase in operational costs||Unacceptable impact on cost, schedule or technical baselines|
There is then a table in Figure 4-2 that shows a Risk Rating Matrix, to put the likelihood and consequence numbers together into a low-medium-high risk rating. A sum of 5 or less is Low, a sum of 6 or 7 is Medium (EXCEPT the case where Consequence=1 and Likelihood=5 where the rating is still ranked Low), a sum of 8 or more is High.
- A high (H) rating means that a major disruption to the program is likely.
- A medium (M) rating means that some disruption will likely occur.
- A low (L) rating means that the risk, if realized, will have a minimum impact on the program.