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Risk Mitigation is the process of steps taken to reduce either the impact or the probability of the threat. Risk is a condition which may occur in future and may cause an organization physical or financial damage. So it advisable for every organization to take steps to prevent the risk and its effects.The risk can be measure via a risk metric. A simple risk metric is given below.
In the above figure, the high and medium probability risk with high impact must be secure first. One can ignore the Low risk for a while but cannot underestimate them.
Risk Mitigation Steps
- Risk Identification: One must be able to identify the risk that may occur in future. Along with risk identifications, one must be able to derive relationships that what can cause a risk.
- Risk Impact Analysis: One must be able to analysis how the risk will impact on financial and physical structure of organization. In this the probability and impact of risk is estimated. The impact may include cost, schedule technical performance etc.
- Priority Analysis: After identification of all the risks and there impact. The next step is to identify the priority of risk. This means, the risk which have maximum impact on financial and physical structure of an organization must be cured first.
- Risk Monitoring: The final step is to monitor the system or program for the risk. On the same time the strategy to handle the risk must be implemented time to time not after the risk occurred.
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