Effective Risk Management is fundamental to the success of any organization. Without taking risks, no significant advances can be made, whether financial, operational, technical or scientific. However, without strong management techniques, risks can become issues, issues become a crisis and a crisis can become a catastrophe.
Risk management seeks to anticipate and address uncertainties that threaten the goals and timetables of a project. By identifying and managing risks today organizations and businesses can plan well ahead of the problem occurrence.
Today’s businesses have to operate in a more competitive and complex market environment than ever before. Top Level decision makers understand the importance of forecasting, identifying and proactively managing risk – as this is usually the difference between achieving business goals and ending in failure.
Project failures are all too common – a few high profile ones make the headlines, but the cost is always felt. By investing a little time and effort, however, organizations should be able to identify risks at the outset. These risks can be assessed through a range of criteria. The assessment methodology may be basic or complex depending on the environment, but it must always be consistent.
Once the high priority risks are known, mitigation strategies can be set up to reduce the probability of the adverse event occurring, or the size of impact should it happen. Then it is time to “work the plan” and produce timely and accurate reports to Management and the decision-makers.