Understanding Risk Management
Risk Management is related to all the fields and is not confined to one particular field. People in different fields like statistics, economics, engineering, systems analysis have contributed to the task of risk management. There are many books and solutions available for risk management. Proper risk management enables you avoid adverse effects in the future that are caused by the risk involved in your business or entity.
To manage risks properly you have to identify the risks involved properly. Risk is a condition that may lead to loss and you have to know that clearly. The amount of loss that may occur as a result of that risk should be evaluated early to prevent such risks. You should always know the risks involved in any business or projects before they occur. This helps you to be prepared to face it with ease. Risks have different meanings for different professionals.
If you are managing a project and you find that a new technology is being introduced in the project. You will know that the persons who are executing the project are not familiar with the technology and there is learning curve involved in getting familiar with the technology. This might get your project delayed and it the risk of the new technology is that the schedule for your project will be affected. You have to evaluate this risk and find out the loss that occurs for not meeting the schedule. This kind of risks frequently happens in the software field. As a result of the new technology there is also a risk that your project quality would be affected.
In such cases the risks have to be analyzed at each stage of the project so that the risk is reduced in the overall project. The impact of risk at each stage of project should be tracked. Continuous risk assessment is necessary in some projects. In certain projects the risks are analyzed only once during the start of the project. But this may not apply to all the projects. Risk evaluation and analysis have to be done on project basis.
There are products available for risk evaluation. You have to feed in certain data into the software application and it would enable you to evaluate the risks involved. Usually a committee is formed to analyze the risks involved in any project. This committee is formed to identify the risks, track the risks, and mitigate the risks and to communicate the risks to the upper management. This committee with the interaction with the project managers, development team, and other support personnel will identify the risks involved. The areas of the project that are identified as risks are reported and recorded.
The existing methodology and the tools for development are identified and enhancement needed to mitigate the risks is identified. Onsite planning has to be done to mitigate the certain risks in certain important areas of the project. The findings of the project committee are passed to the project team and they are allowed to follow certain steps and enhancement in the project development to avoid the risks as much as possible.
Risk mitigation is a separate area that requires experienced personnel to identify the risks involved in a project. There are many companies that have consultants to do this task. Once the risk management process is in place you should have some means to check the risk process. Uncertainties are anticipated while the project resources and activities are managed.
To know more about Risk management you can use a book called Continuous Risk Management Guidebook that is written by professionals involved in software intensive projects. This book gives the underlying principles, concepts and functions of risk management and provides you with the guidance on how to implement risk management in your projects.
Proven practices are given in this book which might be very useful to you. Many other resources are also available in the net for learning more on risk management. There are several tools available for managing risks in your projects and business.
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Thursday, June 17th, 2021
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