Risk Exposure is an aggregate measure of the potential impact of all risks at any given point in time in a portfolio, program, or project.
It combines the probability and consequences of identified risks into a single value or risk profile, providing insight into the overall level of uncertainty and potential deviation from objectives.
Key Characteristics
- Cumulative Measure – Reflects the totality of risk, not individual items
- Dynamic and Time-Based – Changes as risks are identified, updated, or resolved
- Supports Risk-Informed Decisions – Enables prioritization of resources and attention
- Can Be Quantified – Often expressed in monetary or schedule impact terms
Example Scenarios
- Calculating total cost exposure based on the expected monetary value of all active risks
- Reassessing risk exposure at phase gates to determine readiness to proceed
- Monitoring changes in exposure as risk responses are implemented and new risks emerge
Role in Risk Monitoring and Control
- Informs Stakeholder Communication – Provides a snapshot of overall project risk health
- Supports Forecasting – Anticipates potential deviations from baselines
- Enables Threshold Management – Triggers action when exposure exceeds tolerances
- Guides Contingency Planning – Justifies reserve levels and escalation paths
See also: Quantitative Risk Analysis, Expected Monetary Value Analysis, Contingency Reserve, Risk Threshold, Monitor Risks.