Post by account_disabled on Mar 6, 2024 0:42:44 GMT -6
Create a Risk Scorecard By this stage you should have a list of specific risks that could affect your company and two scores next to each of them one for likelihood and one for impact. Now well create a risk scorecard that summarizes these risks and their relative importance. Its actually very simple to do this. Just multiply the two numbers together to give an overall risk score. Heres an example of how it could look Risk Likelihood Impact Risk Score Key client XYZ Corp is late paying its invoice. Loss of power for more than hours. Janet leaves the company. A new competitor undercuts the price of our main product. 2 5 10 Scathing product review from an influential magazinewebsite.
Youll have lots more risks than this of course but this table at least gives you an idea of how it works. In this example I think my key client is very Job Function Email List likely 5 to be late paying its invoice but the impact wont be that high 2. Itll be inconvenient but I can survive on the payments from other customers. So a medium risk score. On the other hand losing my Chief Operating Officer is a big risk. She has lots of specialized knowledge about the business as well as contacts with key clients. If she went to a competitor it would have a large impact.
And it scores a for likelihood tooperhaps shes told me shes unhappy in her role and looking for a new challenge. So a high risk score. This is something to focus on. Next Steps In this tutorial youve learned how to identify key risks in your business and assign scores to them based on their estimated likelihood and impact. Keep in mind of course that these scores are only estimates. Theyre designed to help you prioritize but you should feel free to use your own judgement.
Youll have lots more risks than this of course but this table at least gives you an idea of how it works. In this example I think my key client is very Job Function Email List likely 5 to be late paying its invoice but the impact wont be that high 2. Itll be inconvenient but I can survive on the payments from other customers. So a medium risk score. On the other hand losing my Chief Operating Officer is a big risk. She has lots of specialized knowledge about the business as well as contacts with key clients. If she went to a competitor it would have a large impact.
And it scores a for likelihood tooperhaps shes told me shes unhappy in her role and looking for a new challenge. So a high risk score. This is something to focus on. Next Steps In this tutorial youve learned how to identify key risks in your business and assign scores to them based on their estimated likelihood and impact. Keep in mind of course that these scores are only estimates. Theyre designed to help you prioritize but you should feel free to use your own judgement.