Which analysis helps in understanding the ranking of risks based on their impact?

Qualitative Risk Analysis is a crucial method in project management that focuses on understanding and prioritizing risks based on their potential impact and likelihood of occurrence. This analysis involves assessing the nature of each risk, categorizing them, and ranking them according to their significance to projects. By using techniques such as risk matrices or expert judgment, project managers can identify which risks are most critical and require immediate attention or mitigation strategies.

This method is particularly valuable in the earlier stages of a project when detailed numerical data may not be available, allowing teams to make informed decisions about where to allocate resources for risk management. It emphasizes the subjective assessment of risks rather than quantifying them through statistical methods, making it easier to communicate findings to stakeholders and make strategic decisions regarding risk response.