Monday, April 13, 2015

Mitigating Risks: Contingency Plans

http://www.inc.com/graham-rapier/managing-risk-infographic.html

Here is a very helpful resource on how to mitigate the business risks in planning stage. I will share some of the insights that we can take away from this website.

First, risk can be calculated as probability of event * negative impact. That is, we often perceive the risk is very huge, but in reality, the probability can be very low. So, don't be overwhelmed by the potential risks, when the chances are small.
 
Second, if you would like to categorize risks , here are 17 detailed categories that we can use. This can be more detailed than the four categories we learned in class: technical, financial, market, and people, but worth to know!
 
Third, how to identify and evaluate risks? In the similar way we learned in class, we can list the potential risks, rank them, estimate the seriousness of the risks by predicting costs, and do the cost and value of risk estimation.
 
Fourth and last, minimize the effect of risks as below. Consult in early stage, do the pilot studies, make them as flexible decisions, minimize the complexity of technology if necessary.... These are all valid ways to mitigate risks. Check them out!
 
Among the 10 ways to minimize the risks, what can you take away? What do you think the list is missing?

 

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