Element 3: Negative impact on the value

One of the fundamental reasons it is important to identify risks while performing business analysis is because we need to know the conditions that will increase the likelihood of a negative impact on the value we are working toward delivering. It is important to determine the level of risk and the likelihood of the risk eventuating. 

There is the possibility to be able to quantify the overall risk level in financial terms, by looking at the amount of time potentially lost or spent, or at the effort involved.

Let's consider the following example: 

A company is required to move their server hosting from one hosting company to another. There are many risks associated with this type of move, but let's look at only a couple here in this example:

The risk of data loss: If this risk does occur, it is possible to consider the financial impact this will have by estimating the costs involved in recovering the data. Another financial implication could be the potential loss of income if the server is down for a period of time.

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