Michael Quinn Kaiser is a successful risk management consultant. Michael Quinn Kaiser spends his days helping his clients determine how to measure risk in their
business.
Once a company’s risks have been identified, it is important to
develop a solid plan for dealing with each of those risks, so that they can be
continually managed. Creating a risk management plan is one of the most important
things a business can do in order to be prepared to deal with the adverse
events.
Decide
The first order of business is to develop a solid risk
management plan. Depending on your company’s needs, the plan format can vary,
but here are a few essential items that should be included in your risk
management plan.
·
A complete list of all individual risks.
·
A rating of the individual risks based on their
likelihood and impact.
·
A complete assessment of current controls.
·
A plan of action to deal with those risks.
Decide How to Handle the Risks
After you have identified the risks, prioritized them based on
the impact to your business and how likely they are to occur, and assessed how
effective your current controls are for handling the risks, you need to make a
decision on whether you will avoid the risk, reduce the risk, transfer the
risk, or accept the risk.
Each of these strategies has their own advantages and
disadvantage to consider.
·
Avoiding the risk completely is an effective way
of dealing with it. By halting the activity that is causing the potential
problem, you can eliminate the chance of incurring losses in your business.
However, doing this will require you to lose out on any potential benefits the
risk may contain.
·
Reducing the risk by taking steps to make any
negative outcomes less likely to occur, or to find a way to minimize its impact
when it does occur. This is the most common strategy and is great for a wide
variety of risks.
·
You can transfer many of your businesses risk to
an insurance company by insuring your vehicles and properties and obtaining
different kinds of liability insurance to protect yourself from lawsuits. For
risks that have a large potential impact, this is the best option.
·
In the case of minor risks, it is best to accept
them. For those risks that received a low score for likeliness and impact, try
to find a simple, low-cost solution for dealing with it.
Recommended to read: Michael Quinn Kaiser Works at 2MQ Risk Management Consulting
Putting a plan in place isn’t enough to mitigate your risks, you
have to continually monitor your business in order to identify and deal with
new risks. Michael Quinn Kaiser helps companies identify risks and develop
plans to keep their business running as a risk management consultant in
California.
