A Crash Course On Risk Analysis and Risk Mitigation

The main guiding principle is to focus on the risks that are within your control. Take proactive steps to identify and escalate risks that may not yet be apparent to more senior people. The intent is to avoid bigger problems later if not addressed now. And given the risks to the broader society, any efforts to deploy resources, expertise, and support that help solve critical problems become the top priority.

Here are four recommendations for effectively identifying business risks and developing risk mitigation strategies:

1. Identify Business Risks. When dealing with the COVID-19 crisis, businesses are evaluating risks in the following categories:

• Workforce protection
• Supply chain stabilization
• Customer engagement
• Financials

All leaders must take into consideration workforce protection as one of their main priorities. At this point, either government or corporate guidance is probably addressing physical protection, although leaders should not take this for granted. For organizations in direct contact with health care providers, continue to monitor and support efforts that protect employees. Beyond physical safety, leaders should evaluate risks associated with changes in how people work.

When addressing other broad business risks, keep in mind the impact internally and externally. Internally, risks may be categorized as those that affect people, processes, stakeholder alignment, and systems. Externally, classify risks as those that impact customers and potential competitive responses. It is important to allocate sufficient time to:

• Engage your teams and stakeholders when identifying and evaluating business risks
• Determine the highest priority business risks that your team can address quickly
• Communicate with other teams and leadership about identified risks outside of your team’s control
• Validate these risks with other

2. Maintain All Business Requirements. Despite all the distractions, it is important to determine what the most pressing business requirements are that can and must be maintained. Below are a few pointers to keep you on track:

• Revisit existing goals and projects to ensure that they are still viable and relevant in light of the current environment
• Reprioritize goals and subsequent activities, as needed
• Ensure that those responsible for meeting the established benchmarks are empowered to fulfill the requirements
• Demonstrate agility by looking for alternative ways to get what is most important done

3. Develop Risk Mitigation Strategies. For each risk it is important to ask:

• What is within the group’s control and what is not?
• What are some potential scenarios that could arise if this risk is not addressed?
• How does this risk impact employees and their engagement?
• What are the specific and measurable actions that can be taken to mitigate this risk?

4. Make Communication a Priority. Once risks are assessed and mitigation strategies developed, it is critical to share findings and plans with the leaders responsible for change implementation.  Effective and timely communication provides leaders and their teams with the ability to problem-solve and act.  Remember to:

• Clearly articulate risks plan to address/mitigate, and what you know and don’t know
• Communicate consistently and continuously about the effect any risks have on goals
• Ask team members to coordinate with peers regarding risk mitigation efforts and report any unanticipated risks that may later emerge

Failure to identify risks and develop risk mitigation strategies quickly reduces the likelihood of achieving change goals and success. This “crash course” can help you identify risks and minimize blind spots. Leaders who recognize that risks are part of the solution help the organization, its teams, and themselves succeed.

Please feel free to contact us for more information regarding our program Rx for Dealing with Change in Difficult Times and broader change execution support.