Risk Management is defined as:
| “the identification, assessment, and prioritization of risks followed by coordinated and economical application of resources to minimize, monitor, and control the probability and/or impact of unfortunate events or to maximize the realization of opportunities.” |
According to this definition, the risk is the possibility that an event will occur and adversely affect the achievement of an objective. Therefore, risk itself has the uncertainty.
To fully understand any risk that you plan to manage, you need to start with a thorough Risk Analysis.
Analyzing risk is a process that involves gathering data and synthesizing information to develop an understanding of the risk of a particular enterprise.
The data analyzed will include:
- Identifying assets and threats.
- Prioritizing the related vulnerabilities.
- Identifying appropriate measures and protections.
While analyzing the data, a prioritization process is followed whereby the risks with the greatest loss (or impact) and the greatest probability of occurring are handled first, and risks with lower probability of occurrence and lower loss are handled in descending order.
Intangible risk management identifies a new type of a risk that has a 100% probability of occurring but is ignored by the organization due to a lack of identification ability.
For example:
- When deficient knowledge is applied to a situation, a knowledge risk materializes.
- Relationship risk appears when ineffective collaboration occurs.
- Process-engagement risk may be an issue when ineffective operational procedures are applied.
These risks directly reduce the productivity of knowledge workers, decrease cost-effectiveness, profitability, service, quality, reputation, brand value, and earnings quality.
Please take a more detailed look at the Risk Management services I offer. If you have any questions, or if you would like additional information, feel free to
