#5 Golden Rules Of Risk Management Practice

#5 Golden Rules Of Risk Management Practice

risk management practiceThe benefits derived from a successful risk management practice are huge. There are lots of money gains especially if you happen to be dealing with uncertain projects events in a practical manner.

In the end, you minimize the effect of project threats and grab the opportunities that arise thereof. You realize that you deliver your projects on time, within the desired quality and budget.

Even your team members will be happy, having been saved from the emergency mode they would have been subjected to should any failures had occurred,

But how do you achieve a successful risk management? What’s the right approach?

First, you need to concentrate more on understanding the psychology of risk instead of the mathematics involved.

From IRM, we give you 5 golden tips in risk management practice. Enjoy.

  • Identify and assess risks:

Risk is everywhere and success in business boils down to identifying and managing potential risks associated with the objectives being pursued.

  • Create a risk aware culture:

Everyone in the organisation must know about risk and the potential impact and consequences of risk. Risk managers must then approach risky issues with a respect not contempt of risk. This is a positive risk culture.

  • Continually reassess risks:

A common phrase goes, ‘The only constant thing is change’. Everything changes, including risks. Effective risk managers should therefore constantly reassess their risks to know what if any, has changed. Mitigation measures should also appropriately evolve with identified changes.

  • Reduce your risk exposure:

All risk arises from exposure. Organisation and operational risk exposure situations must be well understood, reduced and where possible eliminated.

  • Review the cost of risk mitigation:

Effective risk management should be a cost-effective undertaking. Risk managers must therefore review the cost of risk mitigation and ensure that it does not outweigh the benefits.

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