What is a probability-impact matrix and how is it used?

A probability-impact matrix is a grid that maps each identified risk by its probability of occurring on one axis and its impact on project objectives on the other axis. Each cell represents a combined risk score, typically calculated by multiplying probability times impact. Risks falling in the high-probability, high-impact zone are prioritized for response planning. Risks in low-probability, low-impact zones may only require monitoring. The matrix enables consistent, objective risk prioritization across the team rather than relying on subjective judgment.