Risk Management
Purpose of the Risk Management Plan
A risk is an event or condition that, if it occurs, could have a positive or negative effect on a project’s objectives. Risk Management is the process of identifying, analyzing, evaluating, mitigating, and reporting risks.
A risk management strategy provides a structured and coherent approach to identifying, assessing and managing risk. It builds in a process for regularly updating and reviewing the assessment based on new developments or actions taken.
Service Highlights, CPS will help analyze risk from an integrated perspective, exploring risk relationships within your organization to create a more comprehensive understanding of your company’s risk factors. Whether your company is just beginning or has an established framework in place, CPS can assist you in your Risk Management efforts.
Who It's For Any publicly traded or privately held organization:
•Seeking to better understand and mitigate the risks it faces across the entire organization.
•Wanting to benchmark and improve existing risk management arrangements.
•Looking to coordinate and formalize its risk management efforts across the business.
Risk Identification and Assessment
Risk identification is the early and continuous identification of events that, if they occur, will have negative impacts on the project's ability to achieve performance or capability outcome goals. We take a structured approach to assess risks specific to your organization. This includes the collection, identification, categorization and prioritization.
Risk Analysis
The purpose of risk management is to identify potential problems before they occur so that risk-handling activities may be planned and invoked as needed across the life of the product or project to mitigate adverse impacts on achieving objectives.
Risk analysis is the review of the risks associated with a particular event or action. It is applied to projects, information technology, safety issues and any action where risks may be analyzed on a quantitative and qualitative basis.
Risk analysis is a component of risk management. Risk analysis enables you to better understand the impact risk has on your organization and your business objectives. CPS takes a disciplined approach to understanding your risk appetite and developing tolerance thresholds; modeling risks and their variance; providing an analysis of the projected impact of mitigation strategies; assisting you in determining optimal capital allocation; and considering the upside of risk to your business.
Risk Evaluation
Risk evaluation allows you to determine the significance of risks to the company and then to decide whether to accept a specific risk or take action to prevent or minimize it. To evaluate risks, it is worthwhile ranking them once identified. This can be done by considering the consequence and probability of each risk.
Risk evaluation is the process of identifying and measuring risk. It is a fundamental business practice that can be applied to investments, strategies, commercial agreements, programs, projects and operations. The following are the basic steps of a risk evaluation process.
Risk Mitigation
Risk Acceptance: Risk acceptance does not reduce any effects however it is still considered a strategy. This strategy is a common option when the cost of other risk management options such as avoidance or limitation may outweigh the cost of the risk itself. A company that doesn’t want to spend a lot of money on avoiding risks that do not have a high possibility of occurring will use the risk acceptance strategy.
Risk Avoidance: Risk avoidance is the opposite of risk acceptance. It is the action that avoids any exposure to the risk whatsoever. Risk avoidance is usually the most expensive of all risk mitigation options.
Risk Limitation: Risk limitation is the most common risk management strategy used by businesses. This strategy limits a company’s exposure by taking some action. It is a strategy employing a bit of risk acceptance along with a bit of risk avoidance or an average of both. An example of risk limitation would be a company accepting that a disk drive may fail and avoiding a long period of failure by having backups.
Risk Transference: Risk transference is the involvement of handing risk off to a willing third party. For example, numerous companies outsource certain operations such as customer service, payroll services, etc. This can be beneficial for a company if a transferred risk is not a core competency of that company. It can also be used so a company can focus more on their core competencies.
Risk Reporting
Definition: The development and implementation of a risk measurement performance and reporting framework. Establishes a comprehensive risk reporting system that is aligned with other organizational performance management structures and processes. Reports on the strategic and financial impact of risks.
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Diversify Your Knowledge
Forward-thinking leaders:
Will think two or three moves ahead. They think not only about what they have achieved, but about how they can achieve more. They diversify their knowledge, challenging themselves to maximize their responsibilities. Supportive Leaders:
Leads by example, focusing on team development and positive communications.
Fostering pride & ownership, motivating one to self-challenge, creating a positive work environment while providing best work practices and success.