Risk managers drive the Risk Analysis process. They decide whether a Risk Assessment is needed to solve a problem and support the risk assessors in their work. Once the Risk Assessment is complete, the risk managers use the outcome in deciding what to do about the risk. When the risk needs to be reduced, Risk Management will have to choose the best measure(s) to do this.
An ideal Risk Management process includes the prioritization of risks. Risks with the greatest loss and the greatest probability of occurring are handled first, and risks with lower probability of occurrence and lower loss are handled afterwards. In practice this process can be complex.
Steps in the Risk Management process:
- Establishing the context
- Creating the plan
- Review and evaluation of the plan
If risks are improperly assessed and prioritized, time can be wasted in dealing with risks that are not likely to occur. Spending too much time assessing and managing unlikely risks can divert resources that could be used more usefully.Prioritizing the Risk Management stage too highly could keep an organisation or government from ever completing a project or even getting started. This is especially true if other work is suspended until the Risk Management process is considered complete.
At EU level, Risk Management is the job of the European Commission. At Member State level, Risk Management is the responsibility of the national government.