management of risk

...Risk Management... Why is management of risk important? What should be considered for effective risk management? Why use PRINCE2 for project management and minimizing risk? What are the benefits of a risk management system? RIDLog - What is it?

1.	Why is important?
	A certain amount of risk taking is inevitable if your organization is to achieve its objectives. Effective management of risk helps you to manage projects and improve operational performance by contributing to:
	• increased certainty and fewer surprises;
	• better service delivery;
	• more effective management of change;
	• more efficient use of resources;
	• better management at all levels through improved decision making;
	• reduced waste and better value for money;
	• management of contingent and maintenance activities.
2.	What should be considered for effective risk management?
	At a summarized level there are eight questions to address:
	1. Do senior management support and promote risk management?
	2. Are people equipped and supported to manage risk well?
	3. Is there a clear risk strategy?
	4. Are there effective arrangements for managing risks?
	5. Do the organization processes incorporate effective risk management?
	6. Is Risk Assessment integrated with the organization business plan and key objectives?
	7. Are risks handled well?
	8. Does risk management contribute to achieving outcomes?
3.	Why use PRINCE2 for project management and minimizing risk?
	PRINCE2 enables projects to have:
	• A controlled and organized start, middle and end;
	• Regular reviews of progress against plan and against the Business Case;
	• Flexible decision points;
	• Automatic management control of any deviations from the plan;
	• The involvement of management and stakeholders at the right time and place during the project;
	• Good communication channels between the project, project management, and the rest of the organization;
	• The PRINCE2 Risk Component incorporates the latest developments in the area of risk management.
4.	What are the benefits of a risk management system?
	• Brings Management to otherwise ad-hoc Project risks and issues;
	• Improved visibility through the availability of a large range of Automatically generated Reports on-demand;
	• Increased certainty and fewer surprises;
	• Better service delivery;
	• More effective management of project risks and issues;
	• More effective management of Change;
	• More efficient use of project resources;
	• Better management at all levels through improved decision making;
	• Reduced time waste and better value for money;
	• Management of contingent and maintenance activities
	• High Visibility of Risks across multiple projects;
	• Up to the minute accurate reporting on-demand of project activities;
	• Issue Resolution;
	• Decision Tracking;
	• Risk Management linked to business plan and organization objectives.
5.	RIDLog - What is it?
	RIDLog is a tool to support your risk management activities. The tool can be fully adapted to fit your needs and requirements. RIDLog helps you to:
	• create a Framework for Risk Management;
	• manage risk Reporting to senior management, especially risks which cut across core business activities and organizational boundaries;
	• maintain a clear Audit trail of decisions to ensure that risk management reflects current good practice, with quality assurance of key decisions as input to audit.