What is an example of a qualitative risk assessment tool?

A qualitative risk assessment tool focuses on understanding and assessing risks based on non-numerical factors, making SWIFT (Structured What-If Technique) an excellent example. SWIFT is a structured brainstorming method that helps teams explore potential risks by asking "what-if" questions. This approach allows stakeholders to identify risks based on their experiences and judgments rather than relying solely on quantitative data.

In contrast, a risk matrix is commonly used to visually represent risks based on their likelihood and impact but does have some qualitative elements. However, it primarily serves as a tool for categorizing risks into quantitative assessments by plotting them into bands, which makes it less purely qualitative. Monte Carlo Simulation and Value-at-Risk (VaR) are both quantitative techniques that rely on numerical analysis and statistical models to forecast risks and potential losses, further distinguishing them from the qualitative nature of SWIFT. Therefore, by focusing on qualitative analysis, SWIFT provides a comprehensive understanding of risks grounded in team insights and narratives.