Qualitative and Quantitative analysis is performed after potential risks have been identified. But what’s the difference between these confusing terms. Here is a short explanation:
Qualitative Analysis
Qualitative Risk Analysis involves subjective analysis:
- Determine probability of occurrence in terms of Low, Medium, or High or 1 to 10
- Determine potential impacts of occurrence in terms of Low, Medium, or High or 1 to 10
- Display results in probability risk ranking matrix
- Identify risks for further analysis
Quantitative Analysis
Quantitative Analysis involves numerical analysis to determine overall project risk and to identify the risks that require the most attention:
- Uses relevant and verifiable data to produce numerical values
- Uses mathematical analysis to calculate the probability and impact
- Analysis may employ tools such as simulations (Monte Carlo analysis), Decision Trees, Delphi techniques, interviews, and cost and time estimating
- Predicts likely project outcomes in terms of money and time
- Produces a prioritize list of risks