Initiateriskassessment

In business, every day is a risk, solid risk management enables the accumulation of enough resources to thrive by capturing opportunities in it and adapting to the uncertainty and changes.

In business, every day is a risk, when a company embarks on a growth strategy, the risk curve will always be greater than a business as usual approaches. The business management needs to ponder: Is your market sector volatile or relatively stable? What are the biggest risks in risk management? How to manage risk holistically? What are crucial components of holistic enterprise risk management solutions? Etc. 

The purpose of assessing risk against consequence criteria is to determine what risk must be managed, and who needs to be involved in that management, and how to improve business risk intelligence.

Identification of risk: Risks are the matter with probability to occur and impact level in specific areas. In many organizations, business planning and risk management were run as parallel exercises. Very few organizations manage to incorporate the enterprise risk management output into business plans and standard operating processes & procedures. The optimal risk management is multi-dimensions of planning; the business management needs to ask: "What can go wrong? What can you do about it?" In fact, risk identification in planning processes is a crucial step in managing risks; embed risk identification and assessment in operational processes and multiple management disciplines. Ideally, assuming that in any risk management program, all the known and potential risks would have been covered and managed, and over a period of time, you are also able to manage uncertainty and avoid the business pitfalls on the way

Quantification of risk: You can only manage what you measure. In practice, trying to identify all possible risks, the organization perhaps ends up in a huge list that may not be practical to assess and handle smoothly. Risk assessment could be subjective, it’s important to identify, measure, and mitigate much of the asset risks that have a bigger strategic impact or involve servicing important operational processes impacting the survival of the business. Organizations with the right risk attitude and aptitude can use both quantitative and qualitative factors to assess risks under a valid risk evaluation model. Once risks have been identified, each has a risk measurement which tries to be determined and scored objectively. Broadly speaking, the goal for risk management including quantification is to build a solid understanding of decision support and manage risks effectively. As long as risks have been identified and agreed with varying stakeholders as per business need, then you can take place risk models which effectively predict, optimize and consider a continual and sustainable approach with multi-faceted perspectives.

Responses to risk: Instead of risk management being viewed as the role of a few people in risk management, it needs to be viewed as the responsibility of every person in the organization that makes a decision and involves risk. Insightful leaders, professionals, organizations proactively predict, handle, prevent risks, rather than react to the risks. Risk management is not an isolated discipline, but an integral solution that significantly improves business agility, intelligence, and maturity. Risk management requires a lot more future vision and strategic mindset. The good risk managers see that risk can provide very exciting opportunities. Besides identifying risks, spot opportunities, and putting in place a mandated risk tolerance structure via escalation requirements based on current risk ratings. Enterprise architecture reduces the risk of an enterprise through framing enterprise risk management solutions.

In business, every day is a risk, solid risk management enables the accumulation of enough resources to thrive by capturing opportunities in it and adapting to the uncertainty and changes. Enterprise risk management assesses all risks of an enterprise and models them in a consistent fashion. It’s important to look at trust in humans, trust in processes; trust in technology. Risk management as part of quality management, is everyone’s responsibility. Effective enterprise risk management is as much about changing organizational culture, and integrating all hard & soft components into risk management competency.

Posted in: Business Intelligence,GRC