Risk analysis of your idea

25 April 2017   |   Startup, Blogs
Risk analysis and management, a vital key to effective project management.

Risk analysis is the process of identifying and analyzing potential issues that could negatively impact key business initiatives or projects. This process is done in order to help organizations avoid or mitigate those risks. Risk analysis helps us to identify, rate and compare the overall impact of risks to the organization, in terms of both financial and organizational impacts. Risk analysis can help an organization improve its security in a number of ways.

Risk Analysis and Management is a key project management practice to ensure that the least number of surprises occur while your project is underway. While we can never predict the future with certainty, we can apply a simple and streamlined risk management process to predict the uncertainties in the projects and minimize the occurrence or impact of these uncertainties. This improves the chance of successful project completion and reduces the consequences of those risks.

Why Risk Analysis is important?

Risk analysis helps to identify, rate and compare the overall impact of risks to the organization, in terms of both financial and organizational impacts

If you complete preventative risk analysis you can potentially avoid making huge losses

Risk analysis will help your business avoid security breaches

By performing risk analysis you may be able to increase your business’ profits

Risk analysis helps us to identify, rate and compare the overall impact of risks to the organization, in terms of both financial and organizational impacts.

Project team members at various levels identify and handle risks in different flavours. However, this will be ineffective without a structured risk management framework, as this leads to: Incomplete impact evaluation, leading to loss of: Knowledge of the overall impact on the project objectives, like scope, time, cost, and quality. Thus, it is very important for any project organization to set up an effective risk management framework. Instituting such a practice as a project team culture ensures Project progress as desired, with the least amount of deviations or surprise, and in line with project and organizational objectives.

If you fail to plan for future success, you plan to fail.

Jason Maria

The two main approaches to risk analysis are Qualitative and Quantitative Qualitative risk analysis typically means assessing the likelihood that a risk will occur based on subjective qualities and the impact it could have on an organization using predefined ranking scales. The impact of risks is often categorized into three levels: low, medium or high. The probability that a risk will occur can also be expressed the same way or categorized as the likelihood it will occur. Quantitative risk analysis, on the other hand, attempts to assign a specific financial amount to adverse events, representing the potential cost to an organization if that event actually occurs, as well as the likelihood that the event will occur in a given year.

Steps in Risk Analysis.

Risk Identification

Risk Analysis

Risk Response Planning

Risk Monitoring and Control

Risk Efficiency measurement