As part of the quantification process in risk management, we need to find a way to organize the risks so that they can be dealt with in a logical way.
There are two things we need to consider. The first is that the risks need to be put into groups that can then be managed by individuals that are more familiar with the nature of these risks. The second is that the risks need to be put into some priority order. This is because no organization will ever have the funds or manpower to deal with all the risks. At some point the level of impact and probability will be such that even the most conservative of risk takers will take that risk and accept it.
If we use probabilities between 0 and 1 to estimate the likelihood of our risks, ...