Risk Analysis, the Second Step in the Risk Management Process

After identifying your business risk the next step for business owners is to analyze the risk issues. You want to look at frequency and severity of identified risk. You want to make an assessment of the maximum possible loss to your organization from identified risks. You want to use some formulas to calculate the probability of loss and the potential impact risk could have on your business. Compare your projections against the loss data from your company's loss history. If this sounds like a lot of work, unfortunately it is. However in my opinion this is the most important step because it determines your action plan against risk. In my next post we will discuss controlling risk which comes after analysis. Until next time be careful out there. K
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