Important Factors to Consider While Making a Risk Management Plan



Every organization should have a risk management plan in place to mitigate any future threats. If your business or organization is doing well now, you should never think that you can win all the time. For any organization to be successful, it must face failure risks and be very resilient to every possible risk that will come its the way. Technology has advanced and globalization is now fast-paced. It is due to fast-paced globalization that many companies and organizations are now facing more complex risks. As an organization, you should always be ready to encounter and face risks all the time. That is why it is very important to come up with a risk management plan. Here is how you can come up with a risk management plan

Understand the project risks

The number one thing that you should consider while coming up with a risk management plan is understanding the project risks. A risk is simply an uncertain condition or situation that when it occurs, will have a negative or even a positive impact on an organization. To understand project risks, you must also understand the elements of risk. The first element is the condition of a risk event that may happen. The second element is the consequences that may occur due to the risk. The last component is the probability of a risk happening.

Consider good and bad risks

When you are coming up with a risk plan, you should anticipate both the good and the bad risks. Risks that you must be certain to plan for are those risks that impact the budget, timeline, and quality of deliverables. Although many people think negatively about risks, it is very important to know that risks can also have a positive impact on an organization. For example, the market price may drop putting your organization under budget. When that happens, you must plan on how to relocate the money that is saved. According to Marika Tolz, there are three types of risks that one should know of. The first one is a well-known risk or a risk that is already recognized by your organization. The second type of risk is a risk that is unknown and is only known by a few individuals. The last time of risk is a kind of risk that is unknowable. This is the kind of risk that no one thinks about it. When such kinds of risks occur, it comes as a surprise to many.

The risk management process

When you are coming up with a risk management process, there are important steps that you must always follow. Here are some of them

  • Identify potential risks

One thing is for sure, it is very important to try and identify all potential risks. Gather your team and try to brainstorm on all potential risks for better planning. Individuals involved should think about possible risks from the perspective of their roles. They should identify all possible risks and note them down

  • Evaluate and assess potential risks
  • Assigning ownership of each risk
  • Create responses
  • Monitor risks continuously

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