6 Proven Risk Assessment Techniques

There are various risk assessment techniques used in business today. These vary in complexity and method, some offer a broad application and perhaps are more basic than others whilst some offer a more detailed assessment via complex measurements.

Risk techniques do tend to be based around a few core methods based on either formal (step based) processes or more generic brainstorming techniques.

Formal Risk Assessment Techniques

• HAZOP – A thorough analysis tool that can be used to review both simple and extremely complex processes evaluating risk.
• FMEA – Failure Mode and effects analysis (or PFMEA for process) – again a systematic approach to reviewing potential issues and threats determining what failures would mean to the business.
• FTA – Fault tree analysis
• Use of existing business checklist – many companies already have tried and tested Risk management processes that analyses threats. Obviously, the end result will depend on the quality of the checklist but many organizations have developed specific ones that address their business niche. These also have the benefit of being easy to follow with a bare minimum training.

Brainstorming risk management techniques

• What if – Questions are asked, usually in a brainstorming environment, about what could happen in the event of problems. The resultant list that is generated is then developed into a risk register with appropriate mitigation.
• Checklists & What if – obviously you are not limited to using just one technique. Any combination can be used. Brainstorming often forms a fundamental part of most risk management processes but used in isolation can result in things being missed. This is why many organizations often combine brainstorming with a more formal method as a “belts and braces” approach.

Summary

As described above, in most cases various techniques may be used. Where the business operates in a specific niche (i.e. Aerospace) specific tools (or checklists) appropriate to that business should be used that focus on common industry risks.

Where there are specific concerns which might not be identified using standard brainstorming risk assessment techniques these can be added to through more formal process to meet the required result. It should be remembered that any organization should match the risk management technique to the possible outcome and its likely severity. It’s vitally important to tune the assessment technique to the scope of the risks being assessed in order to remove the possibility that risks get missed or too much time is spent reviewing issues that may have no impact.

This article is part of our Problem Solving Guide be sure to check it out for some great problem solving techniques, tools and templates.

How does your organization review risk? We’d love to hear your feedback below in our comments section.