What is risk management?
Risk management is the process of identifying, evaluating and controlling risks that could negatively affect an organization, project or activity.
Main steps:
🔵 Risk identification: Identification of potential risks that may arise during the activity. This can include external and internal risks.
🔵 Risk assessment: Determining the probability of occurrence of each risk and its potential impact on the activity. This can be a quantitative (e.g. financial losses) or qualitative (e.g. reputational risks) assessment.
🔵 Developing risk management strategies: Determining ways to minimize the likelihood and impact of risks. This includes :
🔵 Risk monitoring and control: Continuous observation of risks and the effectiveness of the measures taken to manage them. Adjustment of risk management strategies if necessary.
🔵 Documentation and reporting: Maintaining records of identified risks, measures taken and their results. This helps in further analysis and improvement of the risk management process.