Risk Mitigation

Risk mitigation is a process under risk management practices, which makes sure that the damage caused by risk is either nullified or minimized so that there is little loss. The operations can run smoothly without glitches (Ghaedi,& Ibrahim(2017).It lays out plans for the company, and further steps include prioritizing, monitoring, assessing damages, and assigning resources as per the level of risk associated with a particular section of the company.

Advantages of Risk Mitigation

Since risk mitigation can anticipate the probable risk beforehand and can reduce the effects of an already happened risk in the first place, it can have multiple advantages for a company.

Some of them include:

• Prioritizing risks to enable the company to decide the next course of action
• Enabling the company to identify high effect risks and low effect risks.
• Recognizing problematic areas and strengthening their exploitable points
• Systematically categorizing every risk
• In the event of a threat, reducing the after-effects by planning out the next course of action
• Enabling the owners of the business to transfer risks, that is, distributing the risk to the parties who can both handle them very well.
• Once a mitigation plan is made, it makes sure that the method is tested and verified to be effective against the potential risk.
• Performs quantitative risk analysis so that management can know the probable causes, as well as decided the likelihood of it happening.
• After the risk has been dissolved, risk mitigation plans also involve monitoring of the plan, to make sure that the plan is working correctly, and is efficient enough. Further, it makes sure that the plan is compatible with the current system of work performed in the company.
• If the priorities of the risk and its nature change, risk mitigation involves the process of changing the risk mitigation plan so that it can be updated, keeping in mind the new type of risk.

Conclusion:

In many businesses, risk mitigation is important as it ensures that the business set up is up and running properly. Loss in production can result in loss of goodwill of the company, which may result in the company losing out customers and potential buyers to a competitor. Further, risks can cause many internal damages to the production processes of the company, and this can be successfully avoided by using a risk mitigation plan which is compatible with the company’s way of working and work system. (Straut, & Starr (2017).