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Lesson 4 Risk Identification 2

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15 views

Lesson 4 Risk Identification 2

Uploaded by

Shang shang
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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RISK

IDENTIFICATION
WHAT IS RISK IDENTIFICATION?

Risk identification is the process of


identifying and defining potential risks that
could impact the successful completion of a
project, program, or any other endeavor. This
is the first step in risk management, the
purpose is systematic process of anticipating,
assessing. and controlling potential harm to
an organization.
WHY IS RISK IDENTIFICATION IMPORTANT?

• It helps you understand what could go


wrong and how you might be able to
prevent it.
• It allows you to put together a plan for
dealing with any potential risks that might
arise.
• It helps you make better decisions when it
comes to your busine
ss.
THE RISK IDENTIFICATION PROCESS

The risk identification process defines the scope of a


project or program. It consists of various steps
outlining the project’s boundaries and requirements.
Also, this ensures that it considers and accounts for all
potential risks. These stages include:
• Identifying potential risks
• Assessing the likelihood and impact
• Prioritizing risks
• Developing risk mitigation plans
• Continuously monitoring and updating
TECHNIQUES

• Brainstorming – A group of stakeholders from


different departments or disciplines identifies potential
risks. It can be an effective tool for generating
creative and innovative ideas, and it can help to foster
collaboration and teamwork among project team
members.

• Root Cause Analysis – A systematic approach to


identifying the underlying causes of risks. It involves
investigating the factors contributing to a particular
TECHNIQUES

• SWOT Analysis – It represents the organization’s


strengths, weaknesses, opportunities, and threats. It is
a structured approach that can help to identify
internal and external factors that can affect the
success of an initiative.

• Expert Judgement – Consulting with experts who


have experience with similar projects or in relevant
fields. The experts can provide insights and
recommendations on the technical feasibility, cost-
ADVANTAGES AND DISADVANTAGES

Advantages Disadvantages

• Early identification of potential • Time and resource


risks. consumption.
• Improved planning and • Difficulty in accurately
preparation for potential risks. predicting all risks.
• A better understanding of the • Potential for over-analyzing
risks involved in a project. risks and losing focus on the
• Improved communication and project’s objectives
collaboration among
DIFFERENCE BETWEEN RISK IDENTIFICATION
AND RISK ASSESSMENT
R I SK
A SSE SSM E N T
CONSIDERATIONS
IMPORTANCE OF RISK ASSESSMENT

•Risk assessment involves the recognition of risks and the rating of them
to determine the significant risks facing the organization, project or
strategy.

•It is defined in British Standard BS 31100 as the overall process of risk


identification, risk analysis
and risk evaluation.

•An important feature of undertaking a risk assessment is to decide


whether the identified risk is going to be evaluated at the inherent level or
at the current (or residual) level.

•Assessment of inherent risk is undertaken without taking account of the


controls that are currently in place.
RISK ASSESSMENT TECHNIQUES

Risk Assessment
Techniques, was
published in 2009. This
standard provides
detailed information on
the full range of risk
assessments techniques
that can be used.
ADVANTAGES AND DISADVANTAGES OF RA
TECHNIQUES
N ATUR E OF TH E
RISK MATRIX
NATURE OF THE RISK MATRIX

An organization will need to establish the


measures of risk likelihood and risk
impact that will be used throughout the
organizations.
NATURE OF THE RISK MATRIX
NATURE OF THE RISK MATRIX

The risk matrix can be used to record the outcome of the risk rating exercise
and this will provide a simple visual presentation of the significant risks that
have been recognized or identified.

A risk is significant if it could have an impact in excess of the benchmark test


for significance for that type of risk. Identification of potentially significant
risks will be undertaken during a risk recognition exercise. It is necessary to
decide the:
● magnitude of the event should the risk materialize;
● size of the impact that the event would have on the organization;
● likelihood of the risk materializing at or above the benchmark;
● scope for further improvement in control.
RISK PERCEPTION

The perception of risk by individuals will be affected by a number of factors.


The following are considered to increase concern amongst the general public
in relation to a specific risk to health:
● involuntary (pollution) rather than voluntary (dangerous sports);
● inequitably distributed (some benefit while others suffer);
● inescapable by taking personal precautions;
● arising from an unfamiliar or novel source;
● resulting from human-made, rather than natural, sources;
● causing hidden and irreversible damage, perhaps years after exposure;
● posing particular danger to small children or pregnant women;
● threatening form of death (or illness/injury) arousing particular dread.
ATTITUDE TO RISK
TH A N K YOU!

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