What is risk management?

 

What is risk management?

Risk management is the process of identifying, assessing, and controlling risks. It is a systematic approach to identifying and managing threats to an organization's objectives. Risk management can be applied to any type of organization, from small businesses to large corporations.

The goal of risk management is to reduce the likelihood and impact of negative events. By identifying and managing risks, organizations can improve their chances of success and avoid costly losses.

There are many different approaches to risk management. The most common approach is to use a risk management framework. A risk management framework is a set of steps that organizations can follow to identify, assess, and control risks.

The steps in a risk management framework typically include:

• Identifying risks: The first step in risk management is to identify the risks that an organization faces. This can be done by brainstorming, conducting surveys, or using risk assessment tools.
• Assessing risks: Once the risks have been identified, they need to be assessed. This involves evaluating the likelihood and impact of each risk.
• Prioritizing risks: Once the risks have been assessed, they need to be prioritized. This involves ranking the risks based on their likelihood and impact.
• Controlling risks: Once the risks have been prioritized, they need to be controlled. This involves implementing measures to reduce the likelihood and impact of the risks.

Monitoring risks: Once the risks have been controlled, they need to be monitored. This involves regularly reviewing the risks to ensure that they are still being effectively controlled

Risk management is an ongoing process. Organizations need to regularly review their risk management framework and make changes as needed. By following a risk management framework, organizations can improve their chances of success and avoid costly losses.

Here are some of the benefits of risk management:

•   Improved decision-making: Risk management can help organizations make better decisions by providing them with a better understanding of the risks they face.
•  Reduced costs: Risk management can help organizations reduce costs by preventing losses and avoiding costly lawsuits.
• Increased compliance: Risk management can help organizations comply with regulations by identifying and mitigating risks that could lead to non-compliance.
• Improved reputation: Risk management can help organizations improve their reputation by demonstrating that they are taking steps to manage risks.

If you are interested in learning more about risk management, there are many resources available online and in libraries. You can also find risk management professionals who can help you implement a risk management program for your organization.

How is it done in project?

·        Make risk management part of your project

·        Identify risk early in your project

·        Communicate about risk

·        Consider both threat and opportunities

·        Clarify ownership issues

·        Priorities risks

·        Analyze risks

·        Plan and implement risk responses

·        Register Project Risks

·        Track risks and associated tasks  

Plan Risk Management

·        Analysis and decision making to implement risk.

·        Appropriate to size and complexity of the project.

·        Stakeholders will be involved in planning risk management.

Risk Management Plan

·        Schedule Risk

·        Cost Risk

·        Quality Risk

·        Scope Risk

·        Resource Risk

·        Customer Satisfaction Risk