Regulated industries are taxed with unavoidable risks ranging from reasonable to severe. All it takes to handle these varying obstacles is a simple mind-shift.
Risk management is the detection, assessment, and ranking of risks followed by the application of resources to minimize the likelihood of failure by the identified risk. Translation: assuming and preparing for worst case scenarios. Sounds tedious and complicated, right? Not necessarily.
Developing a thorough plan to tackle risk management helps identify and address risks in an efficient manner. This “game plan” is best when put into action through two effective decision-making components: the approach and the preparation.
You must have the right frame of mind when making your decisions. An open, realistic mindset is essential to approaching risk management. You must accept the fact that risks are unavoidable and be willing to take chances. The more objective and honest you are when looking at risks, the better prepared you will be to take them on.
After identifying all possible threats, it is important to compliment an objective mindset with comprehensive preparation. Premeditative actions you should consider are: simplifying the risk, investigating, and collecting relevant data. Thorough research will increase your confidence. Additionally, considering long term goals prior to making a decision will reduce future risks.
Putting the Game Plan into Action
So you’ve cleared your head and prepared yourself, now what? How do you organize all the information in front of you? Consider the following 5 questions and the given examples before you make your next decision:
1. What are your problem, risk, and opportunity items?
2. Which, if NOT pursued, erode the most value?
3. Which, if pursued, create or protect the most value?
4. Which should you pursue?
5. What are the implications to your plan and budget?
Can you, as a stakeholder in your organization, answer these questions? If so, then you're on your way to making solid decisions. These questions all lead to what we call the PRO Dilemma, a method developed by DEI. For more information, click here.
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Published by Katie Georgi | Enterey Marketing & Communications Team
The Enterey Blog
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