4 Important Principles for Risk Management

risk management Oct 06, 2019
4 Important Principles for Risk Management

The primary goal of risk management is to navigate the uncertainty found in any initiative. As the development of the risk management process begins, here are four general principles to keep in mind to guide decision-making:

  1. The organization and initiative stakeholders have attitudes toward risk. These attitudes will affect thinking throughout the process and need to be determined in advance.
  2. Risk assessment is a team task. The best thinking comes from diversity, many ideas, and following a process.
  3. It is impossible to identify all uncertainty. These are the unidentified opportunities and threats that may present themselves during the execution of the initiative. While not identifiable in advance, do record them as this may be helpful for future initiatives.
  4. Focus on finding the highest priority risks. Since it is impossible to identify all uncertainty, try to focus on the highest priority risks - those with the highest impact and likelihood.

For more important risk management principles, read 4 More Important Principles for Risk Management.

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