Risk Management: AAA Response Strategies
Some experts believe that the development of risk responses is the most critical step in the risk management process, and it is easy to see why. By crafting and executing well-planned risk responses, we can mitigate potential threats, leverage opportunities, and significantly increase the odds of project success.
But what does a good response look like? Following are the criteria that all risk response strategies should satisfy:
- Appropriate. The response must fit the level of risk. If a realized risk is likely to cost $10,000, but the risk response costs $20,000, the strategy is not appropriate. In practice, "do nothing" (that is, accept the risk) is often the most appropriate response to a particular threat. Even where the response strategy costs less than the risk realization, it must still fit within the overall budget. Any risk response that is unaffordable is inherently inappropriate.
- Actionable. The response must also be feasible, both technically and logistically. Perhaps there is a risk that your off-the-shelf database won't meet performance requirements. If your risk response strategy is "Invent our own database," it is probably not an actionable plan for most teams. Any response we craft must also lie within our authority to execute. For example, planning to redeploy resources from another group is useless if you lack the power to do so.
- Agreed. The risk response must be accepted and approved by all relevant stakeholders. If a cost is associated with the strategy, this should be included as a line item in the project contingency and signed off by project leadership. Each response must also have a single agreed owner who is responsible for implementing the plan when triggered.
If our proposed risk response meets all these criteria, it is a "Triple A" strategy and is much more likely to mitigate against potential threats or realize potential opportunities.
Risk Register by ProjectBalm
Crafting superb risk response strategies is much easier with a suitable tool, which is one reason we created Risk Register by ProjectBalm.
Our goal was to automate best practice risk management techniques, and do so via an elegant, usable interface that works with you, and not against you. Risk Register will help you to identify, analyse, treat and monitor risks more easily and effectively than ever before.
If you are experienced at risk management, you will find in Risk Register a tool that works the way you want it to work. If you are new to risk management, our documentation and videos will take you through the whole risk management process, giving lots of useful examples.
Risk Register is fully compatible with risk management standards such as ISO 31000, and can also be used for governance, risk, and compliance (GRC) programs such as Sarbanes-Oxley and PCI. And, of course, Risk Register allows you to easily distinguish between opportunities and threats.
Over the last few years, we've grown to become the most popular risk management solution in the Jira marketplace and we are now an Atlassian Platinum Partner. Why not try out Risk Register for yourself?