Use This Chart to Predict -- and Prevent Disaster

Risk Management – Pro-Level Insight in 2 Minutes

You’ve seen the chart. (And if not—scroll down and feast your eyes.) This colorful matrix isn’t just eye candy. It’s how pros think about risk before a single dollar goes out the door.

🔍 Here's How to Use It:

1. Assess Likelihood – How likely is this risk to occur? (Be honest.)

2. Assess Consequence – If it happens, how bad is it?

3. Multiply the two – That gives you a risk score from 1 to 25

4. Check the color zone – Green? Proceed. Orange? Plan. Red? Rethink.

This gives you clarity in chaos. It also makes for great conversations with partners, lenders, and team members—because “gut feeling” doesn’t scale, but charts do.

🧠 What’s Pro-Level?

• Label each major risk for your deal (contractor bails, funding falls through, buyer ghosts you)

• Plot each one on the matrix

• Put mitigation strategies in place for anything that hits orange or red

🧱 Want More?

This is just the summary. Last year, we broke this chart down over five days—one quadrant at a time.

📍 Head over to the REI Quick Tips website and use the handy search feature. Search for “risk management” (use the quote marks - it will get better results).

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