Risk management is important because it tells businesses about the threats in their operating environment and allows them to preemptively mitigate risks. In the absence of risk management, businesses could be blindsided by risks and possibly face significant losses. A properly implemented Enterprise Risk Management program supports better structure, reporting, and analysis of risks. Standardized reports that track enterprise risks can improve the focus of directors and executives by providing data that enables better risk mitigation decisions.
No risk management program can get very far without an in-depth understanding of specific risks that an organization faces. That is why risk identification and assessment are important – as a way for the organization to get a handle of the universe of significant risks it faces and to determine how important each risk is to the achievement of overall goals.
Although identifying and assessing risk are important, they are only the initial steps. It is rare that risk assessment projects are seen as the end of an overall Enterprise Risk Management process. For organizations to appropriately manage and mitigate their critical risks (that fall outside acceptable tolerance levels), organizations must act. An effective enterprise risk management program will also include the development of risk responses, controls, and monitoring activities. The overall risk management cycle includes the following ongoing activities:
- Identify the Risk
- Analyze the Risk
- Evaluate or Rank the Risk
- Treat the Risk
- Monitor and Review the Risk
Conducting an enterprise–wide risk assessment brings together your organization’s key personnel to identify threats, critical risks and impacts that should be considered when pursuing the overall mission and objectives of the organization. SLK’s experienced team will work with your organization to facilitate interviews and workshops with the key individuals and departments within your organization to assist in identification, prioritization & planning of remediation activities for critical tasks.