How do you adjust risk assessments for different contexts?

The first step is to identify the assets that potentially are at risk of damage or worse. The second is to classify according to the importance of the assets to the organisation. The third is to start, top down, to assess what risks are out there and which assets, are potentially affected. This also entails assessing individual risk profiles. What is / are the risk profiles of the places, situations etc. that you will be dealing with? (The Context). Who /what are the adversaries? What do they want? What are they capable of doing in order to get what they want? Once you have this information, you can begin developing both individual and overall risk mitigation plans.

Risk assessments are always subjective to contexts an organization surrounded with. Every organization has certain strengths and weaknesses. Risk Analysts must exactly identify the internal and external factors. Risk assessments must be tailored according to those factors. Most importantly, organizational objectives define the direction of risk appetite. Risk assessment methods should be based on the scope of risks needed to be evaluated. However, consideration for the stake holders and customers' safety as part of company's mission, vision and core values, are one of the most important aspects of risk assessment.

The industry of the business is one of the most important factors to consider in risk assessment. In some countries, there are national risk assessments that are published by the government of each country. These can be a valuable source of information for companies to understand the risks associated with the specific industry in the specific country.

The first step in adapting risk management to a specific context is to define that context, and more specifically, the type of review… 1- Are we reviewing one or more processes within a single entity? 2- Are you reviewing one or more projects involving a variety of internal and external stakeholders? Identifying risks means identifying all the events that could prevent the achievement of objectives. A clear context is therefore all the more important as, in the case of a process review, it is the objectives of this entity that are considered, whereas for a project, the risk manager must take into account/know the objectives of all stakeholders. Moreover, defining the context and objectives facilitates reflection on scope, tools, etc.

In some industries, such as medical devices, Risk Management is a highly formalised process. The outcome of that process will define whether your device can go on the market or not. A popular approach is to reference a predicate device. This, however, is not always possible.

Choosing the method for adjusting or managing risk depends on various factors, including the nature of the risk, the specific context, and the organization's risk tolerance. Here are some common methods for adjusting or managing risk: 1. Risk Avoidance 2. Risk Mitigation 3. Risk Acceptance 4. Risk Transfer 5. Risk Reduction 6. Risk Sharing 7. Risk Retention 8. Risk Monitoring and Response The choice of method will depend on a careful assessment of the specific risks involved, their potential impact, the resources available, and the organization's risk appetite and overall strategic objectives. It often involves a balance between risk reduction, risk transfer, and risk acceptance to align with the organization's goals and constraints.

Selecting the appropriate risk assessment method is pivotal. Qualitative methods like risk matrices provide a broad overview but lack precision. Quantitative techniques, such as probabilistic modeling, offer numeric insights but demand extensive data and expertise. Hybrid methods combine these approaches for a balanced perspective.Choosing between top-down and bottom-up approaches depends on context complexity and data availability. Participatory methods involve stakeholders for diverse insights. Scenario-based assessments contemplate potential futures, event-based focus on specific incidents, and process-based examine entire workflows.The chosen method must align with context specifics to ensure a comprehensive and precise risk evaluation.

There is no single approach to risk management that is best under all scenarios. Qualitative, quantitative and hybrid approaches all have their strengths and weaknesses. One key consideration that should play into the decision on which method to adopt is the background, expertise, skill set and strengths of the risk manager undertaking the analysis. In my experience, the best risk management occurs when the risk manager utilizes the approach that best suits his/her strengths and experiences. In my opinion, the best risk analysis is that which incorporates a qualitative review based on experience and insight, while drawing on quantitative analysis to support the assessment.

Setting clear criteria for risk assessment is essential for making informed decisions about how to manage and prioritize risks. These criteria help ensure consistency and objectivity in assesment: 1. Risk Impact: 2. Risk Probability 3. Risk Tolerance 4. Risk Velocity 5. Risk Exposure 6. Risk Mitigation Costs 7. Regulatory and Compliance Requirements 8. Strategic Alignment 9. Stakeholder Concerns 10. Historical Data 11. External Factors 12. Resilience and Redundancy By establishing and applying these criteria, organizations can systematically evaluate and prioritize risks. Additionally, it's essential to periodically review and update these criteria to reflect changing circumstances, emerging risks, and evolving business strategies.

Establishing clear risk assessment criteria is essential for consistent and objective risk evaluation. These criteria serve as the yardstick for measuring and prioritizing risks. Common criteria include likelihood (the probability of an event occurring), consequence (the impact if it does occur), severity, urgency, frequency, duration, and more. By defining these criteria, you provide a structured framework for assessing risks, ensuring that all potential hazards are evaluated systematically and enabling better-informed decisions on risk mitigation and management strategies based on their relative importance in the context of your project or situation.

Clear criteria for risk assessment, such as likelihood, severity and time frame, are critical in assessing risks. However, one should also recognize there is also a risk to mis-assessing these criteria. Risks judged as high-probability, high-severity might not be so if the assessment of the criteria is off. Try to consider the deviation of the estimate. How many corporations pre-2019 were focussed on risks relating to DEI and climate change? How many corporations correctly assessed the risks associated with moving off the zero lower bound, and the inflationary impact of loose fiscal and monetary policies? How have corporations' risk rankings changed pre-and post-pandemic, and where do economic and personnel risks now lie?

I would utilize risk registers as a way of formally gathering qualitative on-the-ground level feedback from various stakeholders; often these insights aid more than an abstract awareness or implementation of risk management. Be careful not to reduce risk management to internal audit compliance checklists; a balance of both qualitative and the quantitative risk modeling.

Selecting the right tools for risk assessment is fatal for effectively identifying, analyzing, and mitigating risks in various domains, such as business, cybersecurity, project management, and environmental management. The choice of tools depends on the specific context and the type of risk assessment need to perform. Based on evaluation and research, make an informed decision on the tool that best aligns with risk assessment requirements, budget, and usability. Remember that risk assessment is an ongoing process, and tools may need to be adapted or changed over time as organization's needs evolve. Regularly we need to review and update risk assessment tools to ensure they remain effective in managing risks.

Selecting appropriate risk assessment tools is crucial for gathering, analyzing, and conveying risk-related information effectively. These tools can range from checklists, questionnaires, and surveys for data collection, to techniques like interviews, workshops, and brainstorming sessions to elicit insights from stakeholders. Analytical methods like SWOT and PESTLE analyses help in comprehensive evaluation. Tools like risk matrices, registers, maps, dashboards, and reports aid in organizing and presenting findings. The choice of tools should align with the context, complexity, and available resources, facilitating a thorough and structured risk assessment process that informs decision-making and risk management strategies.

Of the above provided there is no single tool you should use. It needs to be a combination to deduce a more accurate answer. Once you have determined the accurate approach for your context make sure you document it so the process can be repeated for consistency. A key part to risk assessments is measuring the movement over time and to do this accurately you need to be completing your assessment of the same risk in a consistent manner.

All of the risk tools: checklists, questionnaires, surveys, interviews, workshops, SWOT analysis etc., are subject to institutional biases and group think, which can hinder the identification of potential risks and the assessment of their severity. Keep this in mind when developing questionnaires/surveys and conducting workshops. Try to ensure diversity of participants. Incude "ideators", creative types, those who can "think outside the box" and those who are willing to voice minority opinions.

You know, when adjusting risk assessments, it's not just about the tools or methods. Think about past experiences – what history tells us can often flag future risks. Always chat with stakeholders; they have invaluable insights. And don't forget the big picture: external factors like political or environmental shifts matter. Oh, and risks change, so review them periodically. Lastly, consider ethics – it's not just about what can go wrong, but what's right to do. And budget for risk; being prepared financially is key

Imagine this:Our company was on the cusp of launching a groundbreaking product that had the potential to reshape our industry. Excitement was palpable, and expectations were high. But, as fate would have it, a global supply chain disruption struck just weeks before the launch date. Panic could have easily taken over, but our risk management team had a different plan. With contingency plans in place and a thorough assessment of the situation, we swiftly identified alternative suppliers, adjusted timelines. The result? Not only did we weather the storm, but we emerged stronger than ever. Our ability to adapt and mitigate risks not only saved the launch but also earned us trust and loyalty from our customers.

utilize risk registers as a way of formally gathering qualitative on-the-ground level feedback from various stakeholders; often these insights aid more than an abstract awareness or implementation of risk management. Be careful not to reduce risk management to internal audit compliance checklists but handle both the qualitative and the quantitative risk modeling side.

It is likely that each team member will assess RISK differently. Before moving forward, it is important to listen to everyone's opinion, try to achieve a consensus from the group, and then prioritize the risks based on available resources. Should priorities be set by time, money, labor/skill sets, organizational wishes and dreams, organizational mission statement, etc.

In addition to definin context, chosing the method/s, setting the criteria, and selecting the right tools, there are several other important factors to consider while conducting a risk assessment: 1) Risk Identification 2) Data Quality 3) Stakeholder Engagement 4) Risk Tolerance 5) Risk Assessment Methodology 6) Scenario Analysis 7) Historical Data and Trend Analysis 8) Risk Communication 9) Risk Interdependencies 10) Risk Mitigation Strategies 11) Monitoring and Review 12) Documentation 13) Legal and Regulatory Compliance 14) Continuous Improvement 15) External Factors Regularly revisit and update your risk assessments to stay proactive in managing risks and achieving your organization's objectives. Regards, Selim