Risk Management Assessment Scoring

Risk criteria are defined in terms of the following 2 elements.

The Likelihood of an event occurring, and
The Consequence of that event occurring

1. The Level of Likelihood element shall be determined using the criteria specified in the following Levels of
Likelihood Criteria table, and assigned a Level Number.
The level should be determined by evaluating all available information, both current and historical, or by
estimating the probability of occurrence using experience and judgment as a guide. Every effort should be
made to ensure the determined Level is accurate.

LEVELS OF LIKELIHOOD CRITERIA

PROBABILITY of
LEVEL LIKELIHOOD
OCCURRENCE
LIKELIHOOD

0 Not Likely 10%

1 Low Likelihood >10% - 30%

2 Likely >30% - 50%

3 Highly Likely >50% - 90%

2. The Level of Consequence element shall be determined using the criteria specified in the following Levels
and Types of Consequence Criteria table, and assigned a Level Number.

LEVELS AND TYPES OF CONSEQUENCE CRITERIA

LEVEL PRODUCT QUALITY DELIVERY SCHEDULE COST

Insignificant.
Minimal or
0 Requires minor rework such as No impact
no impact
deburr to bring into full conformity.
CONSEQUENCE

Cost
Minor. Minor impact. Internal schedule slip.
increase
1 Requires significant rework to Still able to meet original schedule
of
bring into full conformity. and quantity.
< 5%

Major.
Requires major schedule (> 30 Cost
Multiple scrapped parts Extensive
days) or quantity concession from increase
rework or remake. Cannot be
2 reworked to meet conformity
customer. Major impact to of
Customer production schedule. > 5%
requirements. Requires customer
Customer required Milestones. 20%
concession to "Use as is"
Severe.
Cost
All parts scrapped. Unable to Unable to deliver parts. Major
increase
3 produce conforming parts. Unable impact to customer production or
of
to obtain required materials or program schedule.
> 20%
services.

The overall Risk Level is determined using the Risk Assessment Scoring Chart, and is assigned a Level of Low,
Moderate, or High.

Page 1 of 2 MJB PRECISION ENGINEERING LTD F36, issue 1

 Risk Management Assessment Scoring

RISK ASSESSMENT SCORING

3
HIGHLY L M H H
LIKELY

2
L M H H
LIKELIHOOD

LIKELY

1
LOW L L M M
LIKELIHOOD

0
L L L M
NOT LIKELY

0 1 2 3
INSIGNIFICANT MINOR MAJOR SEVERE
CONSEQUENCE

Once the Risks have been identified, they will need to be analysed in terms of their Likelihood to occur, and the
severity of Consequences should they occur. This is accomplished using the Likelihood and Consequence Criteria
charts.

Each Risk shall be assigned a Likelihood Level and a Consequence Level score. These will be used to evaluate
the overall risk assessment score, which in turn will determine further action.

Using the scores developed enter the Risk Assessment Scoring chart at the appropriate Levels for Likelihood and
Consequence to obtain the overall Risk Assessment Score. This will correspond to one of three (3) overall levels of
risk, Low (Green), Moderate (Yellow), or High (Red).

For Risks scoring in the Low (Green) category, Risk treatment is not required. Monitor and Review for future
treatment.

For Risks Scoring in the Moderate (Yellow) category, existing controls must be evaluated for effectiveness. For
controls assessed to be less than Adequate, further risk treatment is required. For controls assessed to be only
Adequate, evaluate for further risk treatment.

All Risks scoring in the High (Red) category shall require risk treatment and / or further analysis.

Scores shall be documented On Form F27 Review of Requirements and Risk Management Check List

Page 2 of 2 MJB PRECISION ENGINEERING LTD F36, issue 1