Risk Management

Everything we do has a certain level of risk. It's the way you manage those risks that could spell the difference between success and failure. This week's articles can help identify the potential risks you face and how to accept them, mitigate them or avoid them.

One of the most important tests of true risk management effectiveness is the level of risk management integration into decision making. (Item #1)     This guide will help you to identify potential risks, make preparations for emergencies and test how your business is likely to cope in a disaster. (Item #2)     Proper risk management implies control of possible future events and is proactive rather than reactive. (Item #3)    

Risk is all about uncertainty. (Item #4)     Your risk management plan should detail your strategy for dealing with risks specific to your business. (Item #5)     Here's an explanation of risk, uncertainty and business strategy. (Item #6)    

As always, I look forward to hearing about your concerns with regard to business continuity. If there are any topics that you'd like to see covered, email me at bmellinger@attainium.net.

Bob Mellinger, President
Attainium Corp

1. Four key concepts for effective risk management

Lately everyone, from government agencies to regulators to corporate board members, seems to be talking about the need for better, more effective, risk management. The challenging part is that, despite the guidance provided in ISO 31000:2009, the concept of risk management effectiveness still remains vague. This article attempts to summarize the main components of effective risk management which should help risk managers to respond to the challenges set by regulators and shareholders.

2. Risk management and business continuity planning

Unplanned events can have a devastating effect on small businesses. Crises such as fire, damage to stock, illness of key staff or IT system failure could all make it difficult or even impossible to carry out your normal day-to-day activities or even keep your business open.

3. Risk Management...the What, Why, and How

Risk Management Systems are designed to do more than just identify the risk. The system must also be able to quantify the risk and predict the impact of the risk on the project. The outcome is therefore a risk that is either acceptable or unacceptable. The acceptance or non-acceptance of a risk is usually dependent on the project manager's tolerance level for risk.

4. Can you really calculate the probability of uncertainty?

Many aspects of risk management are deeply rooted in mathematical formulae for determining probability. This heavy dependence on mathematics to determine probability of risk realization may create 'false positives' regarding a risk that can be either positive or negative. There is also a limitation on how much data can be gathered and assessed in respect to the development of the probability equation regarding the risk being assessed.

5. Preparing a risk management plan and business impact analysis

The process of identifying risks, assessing risks and developing strategies to manage risks is known as risk management. A risk management plan and a business impact analysis are important parts of your business continuity plan. By understanding potential risks to your business and finding ways to minimise their impacts, you will help your business recover quickly if an incident occurs.

6. Uncertainty and Risk Management: What to Do About Black Swans?

We live in an uncertain world. Business practices need to be dialed in to this uncertainty. That's been of theme of my work for some time. Many companies have risk management programs which might sound similar, but really address just part of the challenge.

Quote of the Week:

"The biggest risk is not taking any risk... In a world that's changing really quickly, the only strategy that is guaranteed to fail is not taking risks."

-- Mark Zuckerberg

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