A risk matrix is a planning tool used to assess the level of risk and likelihood of occurrence of any given action. It is most often utilized by development and project management teams but has a wide variety of applicable uses and can help outline the risk associated with any situation or decision.

Figuring out how to calculate risk probability and impact matrix details can be tricky, but FigJam makes it simple. Begin by opening up our free example of risk matrix and then follow this general order of operations:

1. Begin your risk evaluation by determining which decisions you’ll be assessing. To complete this step, you may need to involve a handful of departments and undertake a good deal of information gathering and brainstorming.

2. Plot each identified risk according to its impact (very minor, minor, moderate, major, and critical/high) and the probability of occurrence (rare, unlikely, moderate, likely, and certain).

3. Observe your data, and prioritize accordingly based on risk likelihood.

You can use your filled-in risk matrix sample to determine which risks comprise acceptable and unacceptable combinations of severity and likelihood. Then, you can start prepping to avoid any negative consequences for certain decisions. Share your findings across your organization, source feedback from stakeholders, and begin to lay the groundwork for any potential consequence or outcome.

With a risk assessment matrix template in your back pocket, you can reduce wasted time, increase productivity, and strategize with your whole organization—no risk, all reward.