Island Consulting
RISK MANAGEMENT
How to manage risk
The concept of risk management is simple.
There are six basic steps:
The next three steps are achieved through facilitated workshops. The facilitator leads a team through a process of identifying risks. They draw upon their experience and / or databases of common project risks, and the knowledge of key project team members and business owners.
Using one of a number of techniques, the risks are assigned a rating. These are usually in terms of:-
An optional step is to recalculate the risk ratings, taking the mitigation strategies into account.
The final ‘step’ requires regular reviews to ensure that mitigation strategies were implemented and are working. It is important to review the risk management plan to determine the effectiveness of the strategies, revise the risk ratings, and determine whether any new threats have arisen.
-
Define
the project profile
-
Identify possible risks
-
Rate
the risks
-
Develop
mitigation strategies
-
Implement
strategies
- Monitor
and review
The next three steps are achieved through facilitated workshops. The facilitator leads a team through a process of identifying risks. They draw upon their experience and / or databases of common project risks, and the knowledge of key project team members and business owners.
Using one of a number of techniques, the risks are assigned a rating. These are usually in terms of:-
- Probability: How likely is it that the ‘threat’ will eventuate
- Impact:
What are the potential consequences to the project and the
organisation of this risk?
An optional step is to recalculate the risk ratings, taking the mitigation strategies into account.
The final ‘step’ requires regular reviews to ensure that mitigation strategies were implemented and are working. It is important to review the risk management plan to determine the effectiveness of the strategies, revise the risk ratings, and determine whether any new threats have arisen.
Photo used under Creative Commons from Goldguys
