Risk Analysis: How to classify and Estimate risk
Risk’s perfect definition is very hard to explain, for one organization particular risk be little impact & for second organization loss much & make big losses to concern organization structure, type of organization depends on risk levels. Best way to make a common structure of risk that we can say yes it is risk that we want to analysis & close or reduce risk factors.
RISK = likelihood of incident X Cost of incident
To reduce risk level on any organization have to little step out as below for avoid or skill the risk level that belong to particular areas, machine or event from evaluate risk, risk factors depends to likelihood of any event and what we are loose thought it? We also merge frequency to get micro analysis to concern.
1. Classify Threats:
- When we talk about any organization, company or factory that first need a care of human, due to risk effect on human illness, death or injury etc., need to identify.
- Environmental effects to reflecting weather, disasters and accident, disease around the society.
- Government changes structures of taxes or any policy, foreign policies and influences that majors
- Some other majors threat those technology failures, stock market down.
2. Estimate Risk
- Classification of the risk that need to be estimate the risk very fist check out the likelihood of the effected threat that impact.
- Estimation of the risk level and classification of the threats that on base of impact on particular assess, easier to calculate the cost of the particular threat or impacted event cost to evaluate real risk level.
- Risk Management: Once have worked out the value of risks, need to manage it on right way to effective behavior or approaches that managing all. Management of risk that help to eliminate.
How to manage risk?
- To counting risk and its level the direct way for risk analysis that is introduce new resources for get the analysis data to manage risks.
- Existing resources are also use to evaluate data to counter risk that merge methods, sequences of system, effective changes in required responsibilities to counter risks.
- Better planning is always get advantage for any case, manage risk as best planning to control or minimize risk level to reduce impacts of risk, planning a way to mange risk and its level to figure out risk & threats.
- Review of all parts of the resources, risks levels, threats & planning to reduce risk levels that minimize impacts, little excise that help in future risk management and its analysis to eliminate threats that possible by risk possible in case.
See example, Risk Analysis Format