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Risk Assessment

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Reinalee Hazel Guzman
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22 views12 pages

Risk Assessment

Uploaded by

Reinalee Hazel Guzman
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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How to Perform a Risk Assessment

Risk Assessment Steps


What is a risk assessment and why perform
one?
1
What is my goal?
2
What could keep me from achieving my
goal?
3
What are the possible outcomes?
4
What are my assumptions and are there
correlations among drivers?
5
Is my response enough?
What is a risk assessment and why perform
one?
Risk Assessment: The consideration of the extent to
which potential events have an impact on the
achievement of objectives. The assessment is done
from two perspectives: impact and likelihood. It
includes both positive and negative potential events.

Why perform risk assessments?


• Minimize surprise and impact on operations and administration
• Aid in quick, risk-informed, decision making including allocating time and resources
• Allows risks to be prioritized and paired down for action
• All risks map back to strategic goals and priorities
1
What is my
goal?
Consider the short and
long-term goals and
objectives of your group at
the University. These may Its helpful to consider the
be official statements or University’s three-part
implied. What does it
mean to be successful? mission and the MPact
2025 strategic plan. How
does your group contribute
to the achievement of the
system-wide goals?
2
What could keep me from achieving my
goal?
• Falling short of a goal can result from many factors or
events both internal and external to the University.
These are your risks.
• Remember, risk represents uncertainty so risk can be
negative or positive. A risk event may occur that
provides an opportunity.
• A risk assessment should be done for each key risk or
risk with the potential to have a significant impact on
your goals. The Enterprise Risk Management group has
created tools such as the Risk Self Assessment to help
walk through the process.
3
What are the possible
outcomes?

Best-Case Worst-Case Most-Likely

After identifying risks to the achievement of your goals or


objectives, consider the possible outcomes and scenarios should
those risks occur. Look for the worst-case, best-case, most-likely
scenarios, and possibilities in-between. The Enterprise Risk
Management group has created simple tools assess and score
risks in a consistent way.
Tools &
Resources
Consistent risk analysis
tools are available at
institution and local
levels with tools like this
scorecard.
4
What are my assumptions and are
there correlations among drivers?
• Examine your assumptions when
considering risk scenarios. Leaders may
rely too heavily on their experience
creating “blind spots” in an
unpredictable and sudden environment.
• Consider relationships among risk
drivers. Risk drivers are the causes or
sources of risk such as market
conditions, regulatory changes, or
climate change. Risks are often
interrelated affecting one another.
5 Is my response enough?
Leaders respond to risk in many ways. Approaches include:
• Mitigation (controls): Controls generally include any action taken to
reduce the impact or likelihood of a risk. Controls may include policies
and procedures, preventative computer controls, management reviews,
segregation of duties, training, and many others.
• Transfer (or Sharing): Unacceptable risk can be transferred from the
University to another party such as an insurance company, outside
service provider, or market participant through hedging transactions.
• Acceptance: There may be cases where a risk is acceptable without
taking any action to reduce it.
• Avoidance: Leaders may decide the risk cannot be reduced to an
appropriate level and therefore avoid the underlying activity entirely.
Effectiveness of my response
Its helpful to consider the potential impact of risks both before and after any
responses you’ve already taken. This helps define the “what could go wrongs.”

Inherent Risk: The risk to an entity in Residual Risk: The remaining risk after
the absence of any actions the management has taken action to alter
institution might take to alter either the the risk’s likelihood or impact.
risk’s likelihood or impact.
Mitigation Plan
If the risk assessment results in the need to further mitigate the risk, a risk mitigation plan is needed. The
Enterprise Risk Management group has created tools to help identify the various components of your
mitigation plan. A proactive and risk-aware response will increase the likelihood you achieve your goals!
Thank you!
Please feel free to reach out with additional questions.

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