With regards to the attached, evaluate the use of the risk status reporting as a risk management tool.
With regards to the attached, evaluate the use of the risk status reporting as a risk management tool.
Chapter1: Taking Risks And Making Profits Within The Dynamic Business Environment
Section: Chapter Questions
Problem 1CE
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With regards to the attached, evaluate the use of the risk status reporting as a risk management tool.
Transcribed Image Text:When reviewing the risks you've previously identified and taken action on, remember to
validate your previous risk assessments based on your risk's likelihood and impact.
Changes to your risk may result in changes to either or both of these. Therefore, it is
essential to adjust the risk's priority accordingly. It's also a good idea to validate
previous assumptions and state any new assumptions as this will help you monitor your
risk over time.
How to Report on Risk Changes
Leverage the reporting already in use as part of the risk analysis. There is no need to
have multiple reporting mediums. A quick monthly dashboard with changes and status
of risks and mitigation strategies (which are monitored) and/or changes to the profile
can be enough to provide constant visibility to the state of risk and potential impact.
Keeping this up-to-date should not take much time if the monitoring is performed as
described above. Remember, without information, you cannot make appropriate
decisions. Having consistent reporting will help you convey any changes to your risk
strategy to management and interested parties.
When there is a change to the risk impact or its probability, it may make sense to adjust
the mitigation strategy or the regular risk assessment schedule. Use of current
implemented strategies would be the ideal to use, making changes as warranted. A
complete change in the strategy may not be necessary, but adjustment to the
implementation may be an option.
Risk management is not a project to complete, nor is it a task to check off the to-do list.
It is ongoing and should become part of your overall business continuity culture. As with
most activities, continual attention provides better and more efficient execution, less
effort overall, and better results. Monitoring risk mitigation strategies is actually one of
the most important activities you can undertake. You never know when the event being
mitigated may occur.
Transcribed Image Text:Risk assessment
For many enterprises, normal risk assessment occurs on a regular schedule. These are
often annual occurrences, but monitoring the ongoing risk mitigation and state of
identified risks should be a continuous activity. We monitor and react to risk constantly
in our daily lives; a conscious monitoring of our organization's risk mitigation position
should occur as well.
It's a good idea to schedule periodic risk reviews ahead of time. Take the time each
month to review the highest probable and largest impact risk along with the mitigation
strategy that will allow for continuous improvement.
Periodically re-examine the risk. Has the environment changed in a way that has
impacted the risk? Will you require more or less mitigation? A risk trigger is an indicator
that signals that the risk event has occurred or is about to occur. In other words, what
may cause the impact or the risk to occur? This provides you with a level of reaction
that may limit the impact to your organization if the risk event occurs.
Ongoing review of the risk mitigation plan is required to ensure that it is meeting the
needs of the organization. Review all mitigation strategies, including the status and
effectiveness of the actions you have taken. Surveying those strategies not
implemented also ensures that your plan is moving forward.
Ensuring that all requirements of your risk management plan are being implemented is
critical – otherwise the mitigation strategy can become an unconscious acceptance of
the risk, and may be identified as an additional risk itself.
The modus operandi of your business is always evolving, and even if it's doing so
slowly, new risks may pop up. Your risk mitigation strategy will be ineffective if you're
not tracking new risks based on personnel, vendor, and software changes. Updating
your list of risks is another critical part of maintaining an effective risk management plan.
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