Risk Management 101 Tom Dixon (Bright Consulting) - PowerPoint Presentation

1. Risk Management 101Tom Dixon (Bright Consulting)

2. ANU Risk Management Matrix  Consequence  Minor(1)Moderate(2)Major(3)Catastrophic(4)LikelihoodAlmost Certain(4)M-4H-8E-12E-16Likely(3)M-3M-6H-9E-12Possible(2)L-2M-4M-6E-8Unlikely(1)L-1L-2M-3M-4

3. LikelihoodTitleProbabilityHistoricalAlmost Certain>50%Is expected to occur in most circumstancesLikely25% –50%Will probably occur in most circumstancesPossible5% – 25%Might occur at some time in the futureUnlikely<5%May only occur in exceptional circumstances

4. ConsequenceRisk CategoryMinor(1)Moderate(2)Major(3)Catastrophic(4)Reputation & ImageScrutiny required by internal committees or internal audit to prevent escalation.Scrutiny required by external committees or ACT Auditor General’s Office, or inquest, etc.Intense public, political and media scrutiny. E.g. front page headlines, TV, etc.Assembly inquiry or Commission of inquiry or adverse national media.Financial2.5% of Budget> 5% of Budget> 10% of Budget>25% of BudgetSafety and InjuryMinor injuries / first aidrequiredFirst aid and ongoing medical treatment. Probable lost time.Extensive injuries/ possible multiple injuries. Single FatalityMultiple FatalityOperational LossMinor damage. Loss of operation no more than 1 day.Significant damage to assets. Loss of operation between 1 day to 1 week.Major damage to assets. Loss of operations between 1 week and 1 month.Significant loss of assets. Loss of operations > 1 month.ComplianceMinor breach of statue or regulation.Formal warning from regulator.Suspension ofactivity and prosecution/ financial penalty.Prosecution, financial penalty, cessation of activity.Schedule2.5% of Duration> 5% of Duration> 10% of Duration>25% of Duration

5. RatingsRatingRequired ActionLow Acceptable: Unlikely to require specific application of resources; manage by routine procedures. Monitor and review.MediumAcceptable: Unlikely to cause much damage and/or threaten the efficiency and effectiveness of the program/activity; treatment plans to be developed and implemented by operational managers. Manage by specific monitoring or response procedures.HighGenerally not acceptable: Likely to cause some damage, disruption or breach of controls. Senior management attention needed and management responsibility specified; treatment plans to be developed and reported to PVC/Executive Director or Vice-Chancellor.ExtremeNot acceptable: Likely to threaten the survival or continued effective function of the program or the organisation, either financially or politically. Immediate action required; must be managed by senior management with a detailed treatment plan reported to PVC/Executive Director, Vice-Chancellor and Council.

6. Hypothetical ProjectA camping trip…

7. Camping Trip DetailsFour people attending (Chris, James, Sarah and Meg)Chris is managing the trip, however everybody has been assigned responsibilitiesTwo day trip in July 2013Kosciuszko National Park, NSWNobody in the group has ever camped before$400 budgetDesired outcome is a relaxing weekend

8. Management StrategiesStrategyDescriptionAvoid Eliminate, withdraw from or not become involvedMitigateMitigateTransferOutsource or insureAcceptAccept and budget

9. Risk RegisterItemDescriptionID#Identification number of the riskTitleTitle of the riskDescriptionDescription of the riskImpactImpact of the risk if it is realisedAssigned ToIndividual/area that will be managing the riskStatusStatus of the risk (open, deferred, closed)Cost/ExposureCost if the risk is realisedDue DateDue date for action or anticipated date that the risk will be realisedRisk CategoryCategorisation of the risk (reputation and image, financial, safety and injury, operational loss, compliance or schedule.LikelihoodLikelihood of the risk occurring (unlikely, possible, likely or almost certain)ConsequenceConsequence of the risk occurring (minor, moderate, major, catastrophic)Risk CalculationRisk calculation as per the ANU Risk MatrixRisk StrategyThe risk management strategy taken (avoid, mitigate, transfer or accept)Mitigation PlanActions that are planned to mitigate the riskMitigation CostThe cost of the mitigation planContingency PlanWhat actions will be taken if the risk still occurs despite the mitigation strategiesOwnerWho’s overseeing the management the riskRevised LikelihoodThe revised likelihood of the risk occurring after consideration of the mitigation plan Revised ConsequenceThe revised consequence of the risk occurring after consideration of the mitigation planRevised Risk CalculationThe revised risk calculation as per the ANU Risk Matrix