Quantified risks are those which can be identified and valued at any one time. As explained above, this is an iterative process whereby the amount of quantified risk will increase throughout the procurement process.
The Risk Matrix is a useful management tool in the identification and quantification of project risk. This is described in detail in the following section.
Quantified risk should be incorporated into both the CPAM and the shadow bid model for evaluation purposes. The amount included in these models will vary depending on the amount of risk retained by the public sector and the amount transferred to the private sector. A risk allocation exercise should be undertaken to assess which party is best able to manage quantified risk and to determine which risks each model should incorporate. This process is discussed further later in this section.