What does risk analysis attempt to measure?

Risk analysis focuses on evaluating uncertainties that could impact an organization’s objectives. One of its primary goals is to measure the frequency and severity of potential risks. This involves identifying how often a particular risk might occur (frequency) and the extent of the impact it may have when it does occur (severity). This dual assessment helps organizations prioritize risks and develop appropriate risk management strategies.

While market potential, corporate viability, profitability, revenue streams, employee productivity, and turnover are important considerations in business management, they do not directly pertain to the core objective of risk analysis. Risk analysis is specifically concerned with estimating the likelihood and consequences of risks rather than these broader business metrics.