What is Risk Mitigation? Strategies, Planning and ...

Risk Mitigation is the process of minimizing the likelihood of a risk being realized or the impact of risk. When the risk is identified and assessed, you need ... QuickContact:408-458-8343 WhatisRiskMitigation? ReducefutureuncertaintywithCQRiskManagement&RiskMitigationSolution RiskMitigationPlanning,Implementation,AndProgressMonitoring:EnhancingTheAbilityToIdentify,EvaluateAndMonitorRisks Amissiontoensurecompaniesdrivemaximumvaluewithgreateraccuracyacrosstheglobe RequestaDemo IntroductiontoRiskMitigation Riskmitigationisasystematicprocesswhereanorganizationdevelopsactionsandoptionstoincreaseopportunitiesandreducethreatstoprojectobjectives.Riskmitigationimplementationreferstotheprocessofriskmitigationactions.Riskmitigationprogressmonitoringtracksidentified,newandexistingrisks,andevaluatestheriskprocesseffectivenessthroughouttheproject. Bytakingactionforriskmitigation,thenegativeeffectsofthreatsanddisastersonbusinesscontinuityareminimized.Althoughtheprincipleofriskmitigationistoprepareabusinessforallpotentialrisks,aproperriskmitigationplanwillassesstheimpactofeachriskandprioritizeplanningaroundthatimpact.Ideally,anorganizationwouldbepreparedforallrisksandthreatsandavoidthemfully.However,itacknowledgestheinevitabilityofsomedisastersandsituationswherethreatscannotbeavoidedcompletely.Topreparefortheworst,anorganizationshouldhaveaproperriskmitigationplantominimizedamage.   HowtoDoRiskMitigationPlanning? Riskmitigationplanningisanongoingeffortthatincludesfront-endplanningofhowpotentialriskswillbemitigatedandmanagedonceitisidentified.Therefore,riskmitigationstrategiesandspecificactionplansshouldbeembeddedintheprojectexecutionplan.Riskmitigationplansshould Describetherootcausesofidentifiedandquantifiedrisks Assessriskinteractionsandcommoncauses Findoutalternativemitigationstrategies,methods,andtoolsforeachpotentialrisk Evaluateandprioritizemitigationalternatives Selectandassigntherequiredresourcesrequiredforspecificriskmitigationalternatives Circulateplanningresultstoallprojectparticipantsforimplementation Riskmitigationplanningshouldbedonebeforecompletingtheprojectdesignorallocatingfundsandshouldcontinuetilltheendoftheprojectbycapturinglessonslearnedanddatathatcanbenefitfutureprojects. ImplementationofRiskMitigation SuccessfulimplementationofRiskMitigationispossiblewiththefollowing: Definingwhatplanning,budget,andrequirementsandcontractualchangesareneeded, Instructingtheteamstoexecutethedefinedandapprovedriskmitigationplans, Providingtheriskreportingrequirementsforon-goingmonitoring,and Archivingthechangehistory Riskassessment(identificationandanalysis)isaccomplishedbyriskcategoryanditisimportantforthisprocesstobeworkedthroughtheRiskIntegratedProductTeam(IPT)structure.Itisessentialtomitigateriskbeforepassingituptothenextlevel.IPTmustcommunicatepotentialcostorscheduletoalllevelsofmanagementwhiletheSystemsEngineerandProgramManagershouldunderstand,examineandapprovethemitigationplan.TheIPTsshouldenableeffectivelyimplementedmitigationplansandtheongoingresultsoftheriskmanagementprocessshouldbedocumentedandnotified. WhichareRiskMitigationPrinciples? RiskMitigationisastep-by-stepprocessthatidentifiesandevaluatesrisksandselectsandimplementsoptionsincludingdetailingwhatshouldbedone,whoisresponsible,whenitshouldbecompleted,andassociatedcostandschedule.Themostsuitablestrategyisselectedfromthesemitigationoptions: RiskAvoidance RiskControl RiskTransfer RiskAssumption Riskmitigationprinciplesmustbedeterminedforeachtypeofrisk.Themajorintentoftheriskmitigationplanistoreducetheimpactoftherisk. RiskAvoidance:Riskavoidanceiswhenthefocusisnotoneliminatingtherootcauseorconsequenceoftheidentifiedriskbutreconfiguretheprojectsuchthattheriskdisappearsorisminimizedtoanacceptablevalue. RiskControl:Riskcontroliswhenyoucontroltheriskbyhandlingthecauseorconsequencebysettingupearlywarningsystemsbygatheringdatathatprovideinformationtoevaluatemorepreciselytheimpact,likelihood,ortimingofarisk. RiskTransfer:Risktransferiswhenyoutransfertherisktoathirdpartylikeaninsurancecompanyorsubcontractor. RiskAssumption:Riskassumptionisacceptingtheloss,orbenefitorgain,fromariskwhenitoccursandwherethecostofinsuringagainsttheriskwouldbehigherovertimethanthetotallossessustained. RequestaDemo ComplianceQuestStrategiesForRiskMitigation ComplianceQuest’sRiskManagementSoftwareprovidesuniqueAIandanalyticalcapabilitiestoidentifypotentialrisksbasedonhistoryandtrendingdataalongwithkeymetrics.Withembeddedintelligence,qualityandriskmanagementleaderscanproactivelystarttheirriskmitigationeffortsbeforeitbecomesahugechallenge. RiskMitigationfromReactivetoProactiveComplianceQuest’sRiskManagementSolutionprovidesacompleteandaccuratepictureoftheriskassessmentstoanalyzehazardsassociatedwithanyprocessoractivitysuchasAudits,CAPAs,Change,CustomerComplaints,Deviations,Nonconformances,SafetyanalysisandEnvironmentalimpact.Stakeholderscancollaborateandprioritizeriskmitigationeffortstomakethebeststrategicdecisionstoneutralizenewrisksandimproveoperations. RectifyFutureProblemswithRiskIntelligenceWithCQ’sRiskManagementsolution,anorganizationcandeterminerisktolerancethresholdsandpoliciestoinitiateariskassessment.Thisenablesbusinessestoaccesshistoricaldataonpastriskfactorsusingtheriskregistertoidentifyandprioritizerisktrendsandaddressthehighestriskstopreventfutureevents. BetterCollaborationandEfficiencyIntoday’sinformationworld,therearemanyrisktypesdependingonthedegreeofcriticality.So,toaddressthoseonpriorityandtomanagethemwell,itisessentialtoevaluatethemanddefinemetricsforreal-timeinsights.ComplianceQuest’sRiskManagementisflexibleandintegratedtodriveactivitiesthatprotectandincreaseyourorganization’svalue. Real-timesinglesourceoftruthComplianceQuest’sRiskManagementsolutionisdesignedtoprovidemanagementwithreal-timeinsightintokeyrisks,risktrends,rootcause,correctiveandpreventiveactionplans,andfuturepotentialofincidentsforsuitablestrategiesforriskmitigation. FrequentlyAskedQuestions WhatisRiskMitigation? Riskmitigationistheprocessofplanninganddevelopingmethodsandoptionstoreducethreatsorrisks.Aprojectteamimplementsriskmitigationstrategiestoidentify,monitorandevaluaterisks.Themajorintentofriskidentificationandriskanalysisistoprepareforriskmitigation.Mitigationinvolvesdeductionofthelikelihoodthatariskeventwilloccurandreductionoftheeffectofariskeventifitdoesoccur. WhataretheTechniquesinRiskMitigation? RiskMitigationistheprocessofminimizingthelikelihoodofariskbeingrealizedortheimpactofrisk.Whentheriskisidentifiedandassessed,youneedtomitigateriskinseveralrecognizedways.Somemitigatingactionsdecreasethelikelihoodoftheriskoccurringanditsimpact.Toproperlymitigaterisk,aprojectmanagermustknowhowtoeffectivelyandefficientlymanageit.Riskmitigationtechniquesbeginattheconceptionstageoftheventureandarefollowedthroughoutthelifecycleoftheproject. RiskManagement:Themainobjectiveofriskmanagementistoensurethatuncertaintiesneverharmtheestablishedbusinessgoals.Itisaprocessthatinvolvestheidentification,evaluationandprioritizationofrisktocontroltheprobabilityofitsimpact. RiskIdentificationThemajorpurposeofriskidentificationistorecognize,uncoveranddescriberisksthatcouldaffecttheoutcomeofyourproject.Identifyinganissueanddiscussingitinadvanceisimportanttobegintheriskmanagementprocess.Therearevarioustechniquesthatorganizationsuseduringtheidentificationprocesstoestablishrobustriskmanagementstrategiesincluding: Brainstorming Self-assessmentsandinterviews Risksurveys RootcauseandChecklistanalysis SWOTanalysis Influencediagrams Expertjudgment Assumptionanalysis Duringthisinitialphase,identifyingthecausesofanissueanddevelopingpreventativetechniquesisthemainfocusforidentifyingrisk. RiskAnalysisOnceriskisidentified,itistimetoanalyzeandprioritizethemtounderstanditsgreatestimpactontheproject. PlanningTheplanningstepismoreaboutgettingreadyforriskandcontinuousmanagement.Thefollowingaresomesimpletechniquesthatwillsimplifytheplanningprocessforyou: Evaluationsandmeetings:Ongoingriskassessmentsandstatusmeetingsshouldbescheduledforthereevaluationofexistingrisksandtheclosingofrisks. Riskaudits:Auditinganddocumentinghowexistingriskresponsesareispartoftheauditingprocess. VarianceandTrendanalysis:Cross-checkingplannedresultswithactualresultsusingperformancedatatocontrolandmonitorriskevents. Technicalperformancemeasurement:Comparingtechnicalperformancemeasurementastheprojectisexecutedtowhatisonthemainschedule. Riskmitigationisnotonlyunderstandingandknowingwhenrisksmayarisebutalsoplanningforthemandestablishinganongoingprocesstocontinuallymitigaterisk.Withthoroughidentification,assessmentandplanning,theriskfactorcanbeproperlymitigatedandtheprojectrebuiltsuccessfully. 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