Risk Management
Risk is the chance of something happening that will have an impact on objectives. It is measured
in terms of consequences and likelihood. (Australia/New Zealand Standard for Risk Management
(AS/NZS 4360:2004))
Managing risk enables your organisation to achieve its potential with the least interference from a
risk eventuating. It also enables you to take advantage of opportunities as they arise.
Business Diligence specialises in the following types of risk management:
- Operational risk management: covering technical failures and human errors
- Financial risk management: handling non-payment of clients and increased rate of interest
- Credit risk management: Deals with the risk related to the probability of non-payment from the debtors
A risk assessment is usually a precursor to strategic and business planning, major procurement, projects and change programs. Risk Management is therefore an integral component of all daily business activities.
Managing risk is an ongoing commitment.
It is important to be rigorous in the identification of sources and impacts of risk. The risk treatment strategies are either preventative when directed at the sources or reactive when addressing the impact of the risk.
Business Diligence utilises a proven business risk mitigation methodology, we use templates and tools to assist the risk assessment process such as:
- Risk Matrix (A table in which rows show the risk & columns show their likelihood of occurrence and their impact)
- Risk Treatment Schedule
- Stakeholder Agenda Analysis
- Strengths Weaknesses Opportunities and Threats (SWOT) Analysis
- Political Economic Social and Technological (PEST) Analysis
An unacceptable risk needs to be treated. Business Diligence will work with you to develop risk treatment strategies such as:
a) Avoid the risk by discontinuing the activity that generates it
b) Reduce the likelihood of the occurrence
c) Reduce the consequences of the occurrence
d) Transfer the risk
e) Retain the risk
The intention of these risk treatments is to reduce the risk level of unacceptable risks to an acceptable level.