Mark Zuckerberg, founder of Facebook, once said, “The biggest risk is not taking any risk. In a world that’s changing really quickly, the only strategy that is guaranteed to fail is not taking risks.”
With a risk assessment process, companies can identify and prepare for potential risks in order to avoid catastrophic consequences down the road and keep their personnel safe.
The Risk Assessment process enables users take a look at their organizations to:
- Identify processes and situations that may cause harm, particularly to people.
- Determine how likely it is that each hazard will occur and how severe the consequences would be.
- Decide what steps the organization can take to stop these hazards from occurring or to control the risk.
5 Steps in the risk assessment process
- Identify the Hazards
- Determining who can be harmed
- Evaluating the Risks & taking precautions
- Record the Findings
- Review assessment & update if necessary
Even though you need to be aware of the risks facing your organization, you shouldn’t try to fix all of them at once—risk mitigation can get expensive and can stretch your resources. Instead, you should prioritize risks to focus your time and effort on preventing the most important hazards. To help you prioritize your risks, create a risk assessment chart.
The risk assessment chart is based on the principle that a risk has two primary dimensions: probability and impact, each represented on one axis of the chart. You can use these two measures to plot risks on the chart, which allows you to determine priority and resource allocation.