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6 Factors to Be Monitored Risk Management

Jul 20

Written by:
7/20/2019 2:45 PM  RssIcon

 

Risk management is becoming an important element for a safe business environment, as confirmed by the most recognizable European Foundation for Quality Management (EFQM). We deal with risk in our personal life every day even without knowing it. It’s the same in professional fields. The risk in project management ranks as one of the most important factors when it comes to tipping the balance  between favorable and unfavorable results.

 

There are many ways to address risk management, but they all agree on the first step: identify risk factors. The following diagram shows an appropriate process to assess risks:

 

Identification --> Analysis --> Evaluation --> Treatment

 

The first phase of risk identification is knowing the type of risk factors. Here are some of the possible risks that your organization may be facing:

 

· Corporate Risks are the absence of certainty organizations face when developing their activity.

· Project risk:  An efficient project management in your company can be as important as a line of credit or a client relationship. It is critical that we monitor and improve the development of projects in our organization with effective risk management.

· Operating risks:  those associated with customers, suppliers, products and services, etc.

· Financial risks: credit, treasury, investment, market status, etc.

· Business risks are those that mainly make up the legal and organizational strategy.

· Global risks:  they are mainly associated with culture and reputation, etc.

· Risks processes:  refer to the risks posed by processes of your company that are subject to improvement or change to create value. Keep track and work for process improvement is always a way to combat risks.

 

Risk management should be integrated into the processes of the organization, i.e. it should not be conceived as an isolated activity or responsibility lies only on some employees. It is the duty of all members of the organization, especially in the area of ​​management.

 

What should we do once we have identified the risks?

 

Take actions to eliminate, reduce, minimize and monitor the risks. One good way is to use the help of professional risk management software.

 

If we are clear that project management plays an important role in our company, we must also be aware of the importance of risk management. The result of taking a risk should not always lead to negative results or should not be conceived as necessarily negative. Sometimes it can make a positive deviation from schedule, which may also means an opportunity. But be cautious to the uncertainty because it seems random and too risky when it comes to operating a company, so any company that wants to survive should control the risks involved in their activities.

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