Business Impact-Probability Matrix
The Business Impact-Probability Matrix is a tool used to assess and prioritize risks by evaluating their potential impact on business operations and the likelihood of their occurrence. This matrix helps organizations to identify which risks require immediate attention and resources, enabling more effective risk management and strategic planning.
At a very high level, the Business Impact-Probability Matrix is used in the context of business, risk management, decision making.
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- Cloud Computing Adoption Matrix
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- Cloud Security Risk-Value Alignment Matrix
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- Collaborative Work Environment Matrix
- Competency Assessment Matrix
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- Customer Effort-Value Matrix
- Customer Emotion Matrix
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- Customer Feedback-Insight Matrix
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- Customer Journey Mapping Matrix
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- Customer Lifetime Value-Cost Matrix
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- Direct Marketing Matrix
- Disaster Recovery Matrix
- Distribution Channel Matrix
- Diversity and Inclusion Matrix
- Diversity and Inclusion Matrix
- Due Diligence Matrix
- Earned Value Management Matrix
- Economic Value Added Matrix
- Effort Impact Matrix
- Emotional Appeal Matrix
- Emotional Intelligence Matrix
- Emotional Labor Matrix
- Employee Capability Assessment Matrix
- Employee Capability Assessment-Development Matrix
- Employee Capability Development-Performance Alignment Matrix
- Employee Capability Development-Value Alignment Matrix
- Employee Capability Development-Value Proposition-Value Chain Alignment Matrix
- Employee Capability-Value Chain Alignment Matrix
- Employee Capability-Value Matrix
- Employee Capability-Value Proposition Alignment Matrix
- Employee Development Matrix
- Employee Development-Value Matrix
- Employee Engagement Matrix
- Employee Performance Matrix
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- Employee Performance-Value Proposition Alignment Matrix
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- Employee Performance-Value-Engagement Matrix
- Employee Retention Matrix
- Employee Retention-Talent Matrix
- Employee Retention-Turnover Matrix
- Employee Satisfaction Matrix
- Employee Satisfaction-Performance Matrix
- Employee Satisfaction-Value Matrix
- Employee Skill Development Matrix
- Employee Skill Matrix
- Employee Skill-Will Matrix
- Employee Skills-Value Matrix
- Employee Succession Planning Matrix
- Employee Training and Development Matrix
- Employee Training Matrix
- Employee Turnover-Value Matrix
- Engagement-Conversion Matrix
- Engagement-Opportunity Matrix
- Enterprise Architecture Capability Assessment Matrix
- Enterprise Architecture Capability-Value Alignment Matrix
- Enterprise Architecture Capability-Value Proposition Alignment Matrix
- Enterprise Architecture Matrix
- Enterprise Architecture Maturity Matrix
- Enterprise Risk Management Matrix
- Environment-Performance Matrix
- Environment-Social Matrix
- Environmental Analysis Matrix
- Environmental Impact-Performance Matrix
- Environmental Performance-Cost Matrix
- Environmental Risk-Value Matrix
- Environmental Sustainability-Performance Alignment Matrix
- Environmental Sustainability-Value Alignment Matrix
- Ethics and Compliance Maturity Matrix
- Event Planning Matrix
- Experience Mapping Matrix
- Experience Matrix
- Failure Analysis Matrix
- Failure Mode and Effects Analysis (FMEA)
- Failure Mode and Effects Analysis (FMEA) Matrix
- Failure Modes and Effects Analysis (FMEA) Matrix
- Failure Modes and Effects Analysis Matrix
- Feasibility Matrix
- Financial Analysis Matrix
- Financial Performance-Cost Matrix
- Financial Performance-Cost-Value Matrix
- Financial Performance-Performance Alignment Matrix
- Financial Performance-Performance Alignment Matrix
- Financial Performance-Value Matrix
- Financial Performance-Value Proposition Alignment Matrix
- Financial Performance-Value Stream Alignment Matrix
- Financial Planning Matrix
- Financial Statement Analysis Matrix
- FMEA Matrix
- Force Field Analysis Matrix
- Four Corners Analysis
- Franchise Growth-Value Matrix
- Franchise Maturity Matrix
- Franchise Performance-Value Matrix
- Franchise Profitability-Value Matrix
- Franchise Revenue-Value Alignment Matrix
- Franchise Satisfaction-Value Alignment Matrix
- Fraud Risk Matrix
- Friction-Value Matrix
- Frontline Capability Assessment Matrix
- Frontline Capability Development Matrix
- Frontline Performance-Cost Matrix
- Frontline Performance-Cost-Value Matrix
- Future State Operating Model Matrix
- Gap Analysis Matrix
- Gap Analysis-Opportunity Matrix
- Gap Analysis-Performance Matrix
- Gap Analysis-Risk Matrix
- Gartner's Hype Cycle
- GE-McKinsey Matrix
- Geographic Information System Matrix
- Geographic Segmentation Matrix
- Governance Risk-Value Matrix
- Growth Share Matrix
- Growth Strategy Matrix
- Growth Strategy-Value Matrix
- Growth-Share-Size Matrix
- Health and Safety Risk Matrix
- Hoshin Kanri Matrix
- HR Capability Assessment Matrix
- Human Capital Value Matrix
- Idea Evaluation Matrix
- Idea Generation-Evaluation Matrix
- Idea Prioritization Matrix
- Impact Matrix
- Impact-Feasibility Matrix
- Impact-Readiness-Feasibility Matrix
- Incident Management Matrix
- Industry Attractiveness-Competitive Positioning Matrix
- Influencer Marketing Matrix
- Innovation Adoption Matrix
- Innovation and Improvement Matrix
- Innovation and Improvement Matrix
- Innovation and Risk Matrix
- Innovation and Risk Matrix
- Innovation Capability-Performance Alignment Matrix
- Innovation Capability-Value Alignment Matrix
- Innovation Capability-Value Matrix
- Innovation Culture Maturity Matrix
- Innovation Culture-Performance Matrix
- Innovation Ecosystem Matrix
- Innovation Execution Matrix
- Innovation Funnel-Performance Matrix
- Innovation Funnel-Value Alignment Matrix
- Innovation Idea-Value Matrix
- Innovation Management Matrix
- Innovation Maturity Matrix
- Innovation Performance Matrix
- Innovation Performance-Value Alignment Matrix
- Innovation Pipeline Matrix
- Innovation Pipeline-Performance Alignment Matrix
- Innovation Pipeline-Performance Matrix
- Innovation Pipeline-Value Alignment Matrix
- Innovation Pipeline-Value Matrix
- Innovation Pipeline-Value Proposition Alignment Matrix
- Innovation Portfolio Matrix
- Innovation Readiness Matrix
- Innovation Readiness-Value Matrix
- Innovation-Value Proposition Matrix
- Innovation-Value-Complexity Matrix
- Integrated Marketing Communications Matrix
- Intellectual Property Risk Matrix
- Internet of Things Capability-Value Matrix
- Inventory Management Matrix
- Investment Portfolio Matrix
- IT Capability Assessment Matrix
- IT Capability Assessment-Performance Alignment Matrix
- IT Capability Assessment-Value Alignment Matrix
- IT Capability Assessment-Value Matrix
- IT Capability Assessment-Value Proposition Alignment Matrix
- IT Capability Assessment-Value Stream Alignment Matrix
- IT Capability Maturity Matrix
- IT Service Management Capability Assessment Matrix
- IT Service Management Capability Assessment-Value Matrix
- IT Service Management Maturity Matrix
- IT Service Management-Value Matrix
- ITIL Service Capability Matrix
- ITIL Service Value Matrix
- Job Analysis Matrix
- Kano Model Matrix
- Key Performance Indicator (KPI) Matrix
- Key Performance Indicator (KPI) Matrix
- Key Performance Indicators Matrix
- Keyword Research Matrix
- Knowledge Management Capability Matrix
- Knowledge Management Capability-Performance Alignment Matrix
- Knowledge Management Capability-Value Alignment Matrix
- Knowledge Management Capability-Value Proposition-Value Chain Alignment Matrix
- Knowledge Management Matrix
- Knowledge Management Maturity Assessment Matrix
- Knowledge Management Maturity-Performance Matrix
- Knowledge Management Performance-Value Matrix
- Knowledge-Skill Matrix
- Kraljic Matrix
- Ladder of Inference Matrix
- Lead Generation Matrix
- Leadership Capability-Value Matrix
- Leadership Competency Matrix
- Leadership Development Matrix
- Leadership Development-Performance Alignment Matrix
- Leadership Development-Value Alignment Matrix
- Leadership Development-Value Matrix
- Leadership Development-Value Stream Alignment Matrix
- Leadership Performance-Value Alignment Matrix
- Leadership-Value Matrix
- Lean Matrix
- Lean Process Improvement Capability Assessment Matrix
- Lean Process Improvement Capability-Value Alignment Matrix
- Lean Process Improvement Capability-Value Proposition Alignment Matrix
- Lean Process Improvement Matrix
- Lean Process Improvement-Performance Matrix
- Lean Process Matrix
- Lean Process Maturity Matrix
- Lean Six Sigma Capability-Value Matrix
- Life Cycle Cost Analysis Matrix
- Logistics Performance-Value Matrix
- Maintenance Maturity Matrix
- Market Analysis Matrix
- Market Analysis-Performance Alignment Matrix
- Market Analysis-Performance Matrix
- Market Analysis-Size Matrix
- Market Analysis-Value Matrix
- Market Analysis-Value Proposition Alignment Matrix
- Market Attractiveness-Competitive Positioning Matrix
- Market Attractiveness-Competitive Strength Matrix
- Market Attractiveness-Value Matrix
- Market Development Matrix
- Market Development-Growth Matrix
- Market Development-Size Matrix
- Market Environment-Competitive Intensity Matrix
- Market Environment-Market Growth Matrix
- Market Environment-Market Share Matrix
- Market Environment-Market Size Matrix
- Market Environment-Size Matrix
- Market Growth Matrix
- Market Growth-Competitive Positioning Matrix
- Market Opportunity Matrix
- Market Opportunity-Performance Matrix
- Market Opportunity-Size Matrix
- Market Penetration-Performance Matrix
- Market Penetration-Size Matrix
- Market Positioning Matrix
- Market Research Matrix
- Market Segmentation-Performance Alignment Matrix
- Market Segmentation-Performance Matrix
- Market Segmentation-Value Matrix
- Market Segmentation-Value Proposition Alignment Matrix
- Market Share-Growth Matrix
- Market Share-Size Matrix
- Market Size-Growth Matrix
- Market-Value-Complexity Matrix
- Marketing Analytics Matrix
- Marketing Automation Matrix
- Marketing Campaign-Performance Matrix
- Marketing Effectiveness Matrix
- Marketing Effectiveness-Performance Alignment Matrix
- Marketing Effectiveness-Value Alignment Matrix
- Marketing Effectiveness-Value Stream Alignment Matrix
- Marketing Mix Strategy Matrix
- Marketing Mix-Performance Alignment Matrix
- Marketing Mix-Performance Matrix
- Marketing Mix-Value Matrix
- Marketing Performance Matrix
- Marketing Plan Matrix
- Marketing Research Matrix
- Marketing Research-Analysis Matrix
- Materiality Assessment Matrix
- Maturity Assessment Matrix
- Maturity Assessment-Value Matrix
- Maturity Level-Performance Matrix
- Maturity Level-Value Alignment Matrix
- Maturity Level-Value Proposition-Value Chain Alignment Matrix
- Maturity Level-Value Proposition-Value Stream-Value Chain Alignment Matrix
- Maturity Level-Value Proposition-Value Stream-Value Chain-Performance Alignment Matrix
- Maturity Level-Value Stream Alignment Matrix
- Maturity Model Matrix
- Maturity-Value Matrix
- McKinsey 7S Framework
- McKinsey Growth Vector Matrix
- McKinsey Organizational Health Index
- Media Planning Matrix
- Mergers and Acquisitions Matrix
- Messaging-Media Matrix
- Mission-Value-Complexity Matrix
- Mobile Marketing Matrix
- Multi-Criteria Decision Analysis Matrix
- Multichannel Attribution Matrix
- Multichannel Marketing Matrix
- Net Present Value Matrix
- Net Profit Margin Matrix
- Net Promoter Score-Insight Matrix
- Net Promoter Score-Performance Alignment Matrix
- Net Promoter Score-Performance Matrix
- Net Promoter Score-Value Alignment Matrix
- Net Promoter Score-Value Proposition Alignment Matrix
- Net Promoter Score-Value Stream Alignment Matrix
- Net Revenue Matrix
- Net Worth Matrix
- Network Analysis Matrix
- Online Reputation Management Matrix
- Open Innovation Matrix
- Operating Model Capability Assessment Matrix
- Operating Model Capability-Value Matrix
- Operating Model Capability-Value Proposition-Value Chain Alignment Matrix
- Operating Model Matrix
- Operating Model Performance-Cost Matrix
- Operating Model Performance-Value Alignment Matrix
- Operating Model Performance-Value Proposition Alignment Matrix
- Operational Risk Matrix
- Operations Capability-Value Matrix
- Operations Maturity Matrix
- Operations Performance-Value Matrix
- Organic Search-Competitive Positioning Matrix
- Organizational Agility Matrix
- Organizational Agility-Performance Matrix
- Organizational Agility-Value Chain Alignment Matrix
- Organizational Agility-Value Matrix
- Organizational Agility-Value Proposition-Value Stream Alignment Matrix
- Organizational Agility-Value Stream Alignment Matrix
- Organizational Capability Assessment Matrix
- Organizational Capability Assessment-Value Proposition Alignment Matrix
- Organizational Capability Assessment-Value Stream-Value Chain Alignment Matrix
- Organizational Capability Value Matrix
- Organizational Capability-Performance Matrix
- Organizational Capability-Value Alignment Matrix
- Organizational Capability-Value Creation Matrix
- Organizational Capability-Value Proposition Alignment Matrix
- Organizational Capability-Value Proposition-Value Chain Alignment Matrix
- Organizational Capability-Value Stream Alignment Matrix
- Organizational Change Impact Matrix
- Organizational Change Management Maturity Assessment Matrix
- Organizational Change Management Maturity Matrix
- Organizational Change Management-Value Alignment Matrix
- Organizational Change Readiness Matrix
- Organizational Culture Assessment Matrix
- Organizational Culture Maturity Matrix
- Organizational Design-Performance Matrix
- Organizational Design-Value Chain Alignment Matrix
- Organizational Design-Value Matrix
- Organizational Design-Value Proposition-Value Stream Alignment Matrix
- Organizational Design-Value Stream Alignment Matrix
- Organizational Development Maturity Matrix
- Organizational Effectiveness-Value Alignment Matrix
- Organizational Effectiveness-Value Matrix
- Organizational Effectiveness-Value Proposition-Value Chain Alignment Matrix
- Organizational Effectiveness-Value Proposition-Value Stream-Value Chain Alignment Matrix
- Organizational Effectiveness-Value Stream Alignment Matrix
- Organizational Health Assessment Matrix
- Organizational Health Matrix
- Organizational Performance Matrix
- Organizational Performance-Effectiveness Matrix
- Organizational Performance-Value Matrix
- Organizational Readiness-Value Matrix
- Organizational Resilience Matrix
- Organizational Resilience-Performance Matrix
- Organizational Resilience-Value Chain Alignment Matrix
- Organizational Resilience-Value Matrix
- Organizational Resilience-Value Proposition-Value Stream Alignment Matrix
- Organizational Resilience-Value Stream Alignment Matrix
- Organizational Risk-Opportunity Matrix
- Organizational Structure-Value Matrix
- Organizational Sustainability Matrix
- Outsourcing Matrix
- Outsourcing Risk-Value Matrix
- Paid Search-Competitive Positioning Matrix
- Partner Selection Matrix
- Partnership Marketing Matrix
- People Capability Maturity Matrix
- Perception-Positioning Matrix
- Performance and Potential Matrix
- Performance Appraisal Matrix
- Performance Feedback Matrix
- Performance Management Maturity Matrix
- Performance Management-Value Chain Alignment Matrix
- Performance Management-Value Matrix
- Performance Management-Value Proposition-Value Stream Alignment Matrix
- Performance Management-Value Stream Alignment Matrix
- Performance Measurement Matrix
- Performance-Matrix Marketing
- Performance-Value Chain Alignment Matrix
- Performance-Value Matrix
- Performance-Value-Complexity Matrix
- Personality Assessment-Value Matrix
- Personalization Matrix
- PESTLE Analysis Template
- PICK Matrix
- Porter's Five Forces Framework
- Portfolio Analysis Matrix
- Portfolio Analysis-Evaluation Matrix
- Portfolio Analysis-Performance Alignment Matrix
- Portfolio Analysis-Value Alignment Matrix
- Portfolio Assessment-Performance Alignment Matrix
- Portfolio Optimization-Value Alignment Matrix
- Portfolio Optimization-Value Stream Alignment Matrix
- Portfolio Performance-Value Matrix
- Positioning Matrix
- Process Capability Assessment-Value Alignment Matrix
- Process Capability Matrix
- Process Capability-Performance Matrix
- Process Capability-Value Alignment Matrix
- Process Improvement Matrix
- Process Improvement Maturity Matrix
- Process Improvement-Performance Alignment Matrix
- Process Improvement-Value Alignment Matrix
- Process Improvement-Value Stream Alignment Matrix
- Procurement Capability-Value Matrix
- Procurement Maturity Matrix
- Product Adoption Matrix
- Product Costing Matrix
- Product Design Matrix
- Product Design-Development Matrix
- Product Design-Value Matrix
- Product Development Matrix
- Product Development-Reward Matrix
- Product Development-Risk Matrix
- Product Development-Risk-Value Alignment Matrix
- Product Development-Value Matrix
- Product Differentiation Matrix
- Product Feature Matrix
- Product Feature-Value Alignment Matrix
- Product Feature-Value Matrix
- Product Launch-Performance Matrix
- Product Life Cycle Matrix
- Product Portfolio Matrix
- Product Positioning Matrix
- Product Roadmap Matrix
- Product Roadmap-Performance Matrix
- Product-Market Fit Matrix
- Product-Market Matrix
- Product-Market-Technology Matrix
- Product-Service Matrix
- Product-Service Mix Matrix
- Productivity Improvement Matrix
- Program Management Maturity Matrix
- Project Benefit Matrix
- Project Charter Matrix
- Project Management Capability Assessment-Value Matrix
- Project Management Capability-Performance Alignment Matrix
- Project Management Capability-Value Proposition Alignment Matrix
- Project Management Capability-Value Stream Alignment Matrix
- Project Management Matrix
- Project Management Office Maturity Matrix
- Project Management-Performance Alignment Matrix
- Project Prioritization Matrix
- Project Prioritization-Alignment Matrix
- Project Risk Matrix
- Project Risk-Opportunity Matrix
- Project Risk-Value Matrix
- Promotions Matrix
- Prospecting Matrix
- Public Relations Matrix
- Purchase Decision Matrix
- Quadrant Analysis
- Quality Control Matrix
- Quality Control-Performance Matrix
- Quality Function Deployment Matrix
- Quality Management Capability Assessment Matrix
- Quality Management Capability-Value Alignment Matrix
- Quality Management Capability-Value Proposition-Value Chain Alignment Matrix
- Quality Management Matrix
- Quality Management Maturity Matrix
- Quality-Value Matrix
- Rational Decision-Making Matrix
- Recruitment Capability-Value Matrix
- Recruitment Maturity Matrix
- Relationship Management Matrix
- Relationship Marketing Matrix
- Relationship-Value-Complexity Matrix
- Requirements Traceability Matrix
- Resource Allocation Matrix
- Resource Allocation-Utilization Matrix
- Resource Capability Matrix
- Resource Utilization Matrix
- Risk Analysis Matrix
- Risk Assessment Matrix
- Risk Assessment-Value Matrix
- Risk Management Matrix
- Risk Matrix
- Risk Value Matrix
- Risk-Response Matrix
- Risk-Return Matrix
- Roadmap Matrix
- Root Cause Identification Matrix
- Root Cause Matrix
- Sales and Marketing Alignment Matrix
- Sales and Marketing Alignment Matrix
- Sales and Marketing Performance-Value Chain Alignment Matrix
- Sales and Marketing Performance-Value Chain Alignment Matrix
- Sales and Marketing Performance-Value Matrix
- Sales and Marketing Performance-Value Proposition Alignment Matrix
- Sales and Marketing Performance-Value Proposition Alignment Matrix
- Sales and Marketing Performance-Value Proposition-Value Stream Alignment Matrix
- Sales and Marketing-Value Proposition Alignment Matrix
- Sales and Marketing-Value Stream Alignment Matrix
- Sales Capability-Value Matrix
- Sales Effectiveness-Value Matrix
- Sales Force Effectiveness Matrix
- Sales Growth Matrix
- Sales Maturity Matrix
- Sales Performance Matrix
- Sales Performance-Value Alignment Matrix
- Sales Performance-Value Proposition Alignment Matrix
- Sales Performance-Value Proposition-Value Chain Alignment Matrix
- Sales Performance-Value Stream Alignment Matrix
- Sales Performance-Value Stream-Value Proposition Alignment Matrix
- Sales Performance-Volume Matrix
- Sales Pipeline Matrix
- Sales Pipeline-Performance Alignment Matrix
- Sales Pipeline-Value Matrix
- Sales-Value-Complexity Matrix
- Scenario Planning Matrix
- Scrum Agile Matrix
- Search Engine Optimization Matrix
- Security Capability-Value Matrix
- Service Blueprinting Matrix
- Service Capability-Value Matrix
- Service Delivery Capability Assessment-Performance Alignment Matrix
- Service Delivery Capability Assessment-Value Alignment Matrix
- Service Delivery Capability Maturity Assessment-Value Matrix
- Service Delivery Capability Maturity Matrix
- Service Delivery Capability-Value Alignment Matrix
- Service Delivery Matrix
- Service Delivery Performance-Value Alignment Matrix
- Service Delivery Performance-Value Matrix
- Service Delivery-Value Alignment Matrix
- Service Delivery-Value Matrix
- Service Design and Delivery Capability Assessment Matrix
- Service Design and Delivery Matrix
- Service Design and Delivery-Value Alignment Matrix
- Service Design Matrix
- Service Excellence Matrix
- Service Innovation-Performance Alignment Matrix
- Service Innovation-Value Matrix
- Service Innovation-Value Proposition Alignment Matrix
- Service Innovation-Value Stream Alignment Matrix
- Service Management Capability Assessment-Value Matrix
- Service Management Capability Maturity Matrix
- Service Maturity Matrix
- Service Performance-Value Matrix
- Service Profit Chain Matrix
- Service Quality Matrix
- Service-Value-Complexity Matrix
- Six Sigma DMAIC Matrix
- Six Thinking Hats Matrix
- Skill Gap Matrix
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- Strategic Maturity Matrix
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- Supply Chain Analysis Matrix
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- Supply Chain Visibility Matrix
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- SWOT Analysis Matrix for Marketing
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- System Development Capability-Value Matrix
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- Talent Acquisition-Performance Matrix
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- Talent Pool Matrix
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- Target Market Matrix
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- Technology Evaluation Matrix
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- The 7 Habits of Highly Effective People
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- Transition Capability-Value Matrix
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- User Experience Matrix
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- Value Chain Analysis
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- Viral Marketing Matrix
- Voice of Customer Matrix
- Website Traffic-Conversion Matrix
- Work Breakdown Structure (WBS)
- Workforce Capability Development-Performance Alignment Matrix
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- Workforce Capability-Performance Matrix
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- Workforce Development-Performance Alignment Matrix
- Workforce Development-Value Matrix
- Workforce Development-Value Proposition Alignment Matrix
- Workforce Performance-Value Chain Alignment Matrix
- Workforce Performance-Value Proposition-Value Chain Alignment Matrix
- Workforce Performance-Value Stream Alignment Matrix
- Workforce Skill Development Matrix
- YouTube Marketing Matrix
What is the Business Impact-Probability Matrix?
A visual explanation is shown in the image above. The Business Impact-Probability Matrix can be described as a matrix with the following quadrants:
- Low Probability, High Impact: Risks that are unlikely to occur but would have a significant impact. Example: Natural disaster affecting a key supplier.
- High Probability, High Impact: Risks that are likely to occur and would have a significant impact. Example: Major cybersecurity breach.
- Low Probability, Low Impact: Risks that are unlikely to occur and would have minimal impact. Example: Minor software glitch.
- High Probability, Low Impact: Risks that are likely to occur but would have minimal impact. Example: Frequent but minor customer complaints.
What is the purpose of the Business Impact-Probability Matrix?
The Business Impact-Probability Matrix is a strategic tool widely used in risk management to evaluate and prioritize potential risks based on two key dimensions: the impact on business operations and the probability of occurrence. This matrix is typically represented as a 2x2 grid, with the x-axis representing the probability of the risk occurring (low to high) and the y-axis representing the impact of the risk (low to high).
Each quadrant of the matrix helps categorize risks into different levels of priority:
- Top-Left Quadrant (Low Probability, High Impact): These are risks that are unlikely to occur but would have a significant impact on the business if they did. An example might be a natural disaster affecting a key supplier.
- Top-Right Quadrant (High Probability, High Impact): These are the most critical risks, as they are both likely to occur and would have a significant impact. An example could be a major cybersecurity breach.
- Bottom-Left Quadrant (Low Probability, Low Impact): These risks are the least concerning, as they are both unlikely to occur and would have minimal impact. An example might be a minor software glitch.
- Bottom-Right Quadrant (High Probability, Low Impact): These risks are likely to occur but would have a minimal impact. An example could be frequent but minor customer complaints.
By plotting risks on this matrix, businesses can prioritize their risk management efforts, focusing resources on the most critical risks while monitoring and managing less critical ones. This approach ensures a balanced and efficient allocation of resources, enhancing overall business resilience and strategic decision-making.
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