Risk Mitigation 101: Always have alternatives

Risk mitigation is a process whereby one identifies all possible adverse events (risks) relating to a certain action or event and then creating strategies to reduce the impact should the risk event occur.

Risk mitigation is all about planning ahead. Regardless of the action/event e.g. implementing a new procedure, performing a seminar, making a sales call, etc; risk identification and mitigation is an important step to ensure a favourable outcome.

Let us take an example. Assume Acme Corporation (a fictitious company) is in the process of implementing a new procedure that will increase performance within the operations. This new procedure involves altering the work flow of customer paperwork relating to a certain product of Acme Corporation. Acme is planning to introduce a change whereby the present path of the customers paperwork which is from Dept A to Dept C to Dept E will be altered to a more efficient routing which would be Dept. A to Dept. E and bypassing Dept. C all together.

Acme is now in the implementation phase of the new work flow. Sounds simple enough. However, if Acme does not pause here to identify what could possibly go wrong with the implementation and if they do not create solutions to those events, should they occur, then even simple implementation project can turn in to a nightmare.

For example, Acme customers may be used to dealing with a person from Dept. C, how would the company deal with customer complaints or inquiries? Should a threshold be determined before reverting to the old work flow? Should a complaint resolution process be defined?

Another example could be Dept A may need to learn new skills for this new work flow. What would happen if they encounter a process that usually handled by a Dept C person? What is there are critical vendors that do not like the new procedure after it has been implemented? It would be very difficult for Acme to deal with such scenarios "on the fly".

Sales people can also apply this same principle of risk mitigation preparedness. For example sales people would create strategies for various rejections, i.e. what actions would a sales person take should the customer say X, Y, or Z in response to the product, price, quality etc.?

Therefore planning ahead, identifying issues that could negatively impact the outcome, and creating alternatives should be part of any planned action and/or event to not only ensure success but to make the process smooth.

Sal
www.skkservices.com