Now a days we find most of the organisations give priority to ensure internal control mechanisms are in place and are monitored regularly. However, here we will take up the risk management aspect separately.
Risk management is the identification, assessment, and prioritization of risks (defined in ISO 31000 as the effect of uncertainty on objectives) 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. Risk management’s objective is to assure uncertainty does not deflect the endeavor from the business goals.[Wikipedia]
What is Risk Management Process?:
Risk management process is undertaken to ensure each risk is identified within the project environment and is identified and steps are taken to mitigate these. Let us talk about risk – risk is likely to affect adversely the ability of the project to achieve defined goals and objectives.
What we need to do: When we start a project we may not foresee the likely risks that may affect the project, however, it is important that before starting the project itself we should branstorm amongh the project team, partners, benefciaries as to what sort of risks one may face during the implementation. So how and what we need to do?
First we need identify the likely risks – you can list out all the likely risks whether is small or big. Then further brainstorm and fine tune the list which you think may affect the project adversely, accordinly prioritise the risks.Once we identify the risks then we need to see the ways to mitigate them and monitor. Thus the steps are:
a) Identificaton: Before the start of the project have brainstormin sessions among stake holders on the likely risks and list them all.
b) Prioritisation: Once the list is prepared priortise the risks
c) Identify risk mitiation actions: Once we proritise the risks we need to also brainstorm an and come out with list of likely mitiative actions.
d) Monitorin of risk mitiation actions: Now we need to develop mechanisms to monitor thus prioritised mitigative actions.
e) Closure