Within the overlapping spheres of Total Quality Management and Lean Manufacturing, one Japanese word continues…
Four Risk Treatment Planning Approaches for the Layman
Facing problems is a fact of life. And it can get trickier if you’re running a business or an organization. The stakes are higher and a single misstep in handling risk and damage can cause your reputation, damage to property, or worst, loss of lives.
A good risk treatment planning can save you or any organization from any work-related problems or disaster that may unfold. Risk treatment planning is all about identifying the risk, evaluating what can be done, and planning for an immediate action. Here are the four types of risk treatment and how you should implement them:
Prevention is better than cure they say. Risk elimination is about prevention. This type of risk treatment gets rid of hazards and assets that may create danger for your projects. Risk elimination is all about foreseeing the possible results of certain factors and making sure that there will be no problem that can occur from that certain scenario. Eliminating every single hazardous factor is almost impossible that’s why risk elimination simply attempts to decrease the number of vulnerabilities. An example of risk elimination is training and educating members of the group. If everyone in your group or community is aware of possible risks that may happen and how they can solve them, then there will be no major vulnerabilities in the future.
When elimination or avoidance seems impossible, then risk reduction is the answer. Risk reduction is about reducing the severity of the loss. This is usually used during emergencies like fire, flood, earthquake, and many more. Implementing risk reduction means preparing important factors like fire prevention, safety inspection and even claims management. Always have contact with the local fire and medical center just in case someone needs help. Provide medical health card to your employees so that they have access to good health care and prevent them from getting ill or resigning from the job.
We cannot do things on our own. We cannot solve every problem without calling for help. In situations like these, you can always seek help from outsourcing companies or third party groups. Risk transfer is when you transfer the risk to a third party. It can be about getting an outsourcing accountant, or a company who can handle the organization’s admin. The outsourcing company should be aware of the risk and should comply with a contract for legal purposes.
If the effects of the risk still remains and you already gave all the possible solutions, then it’s time to accept it. Risk containment is the accepting level where you must simply stop the treatment because it already outweighs the benefit. Monitoring the aftermath of the risk is still very important.
Unsound and unplanned disaster treatment can cause great losses. Every part of the society should have their own risk treatment planning in order to be unfazed during unexpected times. Remember to encourage the whole community and organization to be knowledgeable of the risk treatment planning approaches mentioned above.