A risk matrix is a tool that is used to plot the likelihood and impact of a risk on a grid. The grid is typically divided into different risk categories, such as high risk, medium risk, and low risk, based on the likelihood and impact of the risk.
To use a risk matrix, the organization first identifies the risks it is facing. For each risk, the organization assesses the likelihood and impact of the risk using a scale, such as a scale of 1 to 5. The organization then plots the likelihood and impact of the risk on the matrix, and the risk is assigned to a risk category based on its position on the matrix.
The risk matrix can help the organization to prioritize risks and allocate resources appropriately. Risks that are rated as high risk will typically require more attention and resources than risks that are rated as low risk.
Risk matrices are often used in conjunction with other risk management tools and processes, such as risk assessments and risk registers. They can be a useful way to visualize and understand the risks that an organization is facing, and to track progress on risk management efforts.