A 3D Perspective on Modern Risk Prioritisation - Visualising the Speed, Impact, and Likelihood of Risk

What differentiates a critical risk from a tolerable one is

• Its potential impact or likelihood and
• How fast it can materialise (speed–velocity risk).

Integrating Velocity into Risk Assessment

• Traditionally, risk scores are calculated by multiplying impact and probability.
• Total Risk Score=(Impact × Probability)+Velocity
• By adding velocity, the formula can be adjusted to help identify which risks need immediate attention.

Example

• High Velocity: A chemical spill in a factory can cause immediate harm and operational disruption.
• Low Velocity: An ageing workforce might lead to a gradual loss of expertise over several years.

Understanding the Three Axes

• ✅ Velocity (Speed of Onset)
• Some risks unfold slowly (like regulatory non-compliance), while others, such as cyberattacks, strike rapidly and leave minimal time for reaction.
• Velocity captures the urgency with which a risk needs to be addressed.
• ✅ Impact (Severity of Consequence)
• This reflects the damage a risk can inflict on financials, reputation, operations, or compliance standing if it is not managed proactively.
• ✅ Likelihood (Probability of Occurrence)
• Even a high-impact, fast-moving risk may receive lower prioritisation if it is scarce.
• Conversely, a moderate-impact risk that is highly likely may require closer ongoing controls.

Why Include Risk Velocity?

• Timeliness: Some risks can have immediate effects, while others may take longer to manifest. For example, a data breach can have an almost instant impact, whereas reputational damage might unfold over an extended period.
• Preparedness: Understanding the velocity helps organisations prioritise their response strategies. High-velocity risks require quicker mitigation measures.

How to Measure Risk Velocity

• Qualitative Analysis: Categorise risks as high, medium, or low velocity based on expert judgment.
• Quantitative Analysis: Measure the time frame in hours, days, months, or years.

The following 3D Risk Chart provides a dynamic visualisation of how organisations can assess and prioritise risks based on three critical dimensions:

Why This Visualisation Matters

• This model is more than a graphic. It is a decision-support tool that helps boards, chief risk officers and executive committees to:
• Prioritise resources toward fast-moving, high-risk exposures
• Align mitigation strategies with actual threat profiles
• Build escalation plans tailored to velocity and severity
• Enhance overall enterprise resilience and risk-informed decision-making

• By integrating velocity into risk assessments, organisations move beyond static heatmaps and toward dynamic risk intelligence that is responsive, predictive and strategic.

Interpreting the 3D Risk Landscape

The chart positions six major risk categories (Cyber Risk, Operational Risk, Market Risk, Legal Risk, Regulatory Risk, and others) within a 3D space that reveals:

🔴 Cyber Risk sits in the high-velocity, high-impact, high-likelihood zone—making it a top threat that demands real-time monitoring and response.

🟠 Operational Risk is fast-moving and moderately impactful, requiring robust control frameworks and proactive internal audits.

🟢 Market and Legal risks occupy the middle ground—frequent and sometimes fast-moving, but with impact variability depending on exposure.

🔵 Regulatory Risk appears slower and less frequent but carries a significant downstream impact when not addressed, especially from a compliance and reputation standpoint.

Incorporating risk velocity into your risk management framework ensures a more dynamic and responsive approach to potential threats.  

References

• Risk management at the speed of business - PwC https://www.pwc.com/sg/en/risk-assurance/assets/ra-sid-risk-velocity.pdf
• What is risk velocity, and should you track it? - Wolters Kluwer
• https://www.wolterskluwer.com/en/expert-insights/what-is-risk-velocity-and-should-you-track-it
• https://www.linkedin.com/posts/mohammad-salman-khan-a160a15_enterpriseriskmanagement-riskmanagement-operationalrisk-activity-7342085942486167552-UN5Q?utm_source=share&utm_medium=member_desktop&rcm=ACoAAAA_6EIB0wPAWyjQcuq_XiD3asUV8xpMeZ0