Five questions on risk assessment
Companies can spend an enormous amount of effort cataloguing the risks that could affect them at any given moment, on every front. While it’s important to develop that visibility, it’s just as important to measure and prioritize risks so that the organization is prepared to respond to them in an appropriate manner. Because the environment in which you’re operating is constantly — and quickly — evolving, it’s important that organizations are focusing on the right risks, at the right time, in the right ways.
That’s where risk assessment comes in. Assessment is the technique companies use to determine the significance of individual risks in light of business goals. In this issue of Risk Angles, Dr. Patchin Curtis, director, Deloitte & Touche LLP, offers her thoughts on some questions the executive team should consider asking about the risk assessment process. Then, Dr. Mark Beasley, Deloitte Professor of Enterprise Risk Management at North Carolina State University, takes a closer look at risk prioritization, probabilities, and appetite.
This Risk Angle answers the following questions
- Our assessments already cover everything we know can affect our business. Why would we invest time in worrying about the unknown?
- We conduct formal risk assessments once a year. Isn’t that enough?
- It’s hard to make the business case to invest more resources on risk management when we can’t measure the results. How do you measure the avoided costs from an improved risk assessment?
- Can’t we just invest in more technology to improve our risk assessments?
- So far we haven’t been hit with any major surprises when it comes to risk. Why change?
It also takes a closer look at risk prioritization, probabilities, and appetite