4. Risk Management Matrix The following template can be used in developing a risk management picture: Potential risks Probability /Impact ratio Controls /Risk Mitigation P I PxI
5. Risk Management Matrix When rating the likelihood and impact use simple measures Probability Certain 5 Likely 4 Possible 3 Unlikely 2 Rare 1 Impact Catastrophic 5 Major 4 Moderate 3 Minor 2 Insignificant 1
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9. Risk Management Matrix - Example Potential risks Probability /Impact ratio Significance/Controls/Risk Mitigation P I PxI H = High Risk M= Medium Risk L= Low Risk 1. Service to existing clients may suffer resulting in loss of business 4 5 20 H Appoint separate manager and team to manage and deliver services to the new client. Commence weekly service level reporting across all business streams. 2. Key staff are working to capacity and will not be able to take on additional work 4 5 20 H Identify staff within the organisation who can be up-skilled quickly for working with this account. 3. Cash flow will be impacted as agreed payment terms are 90 days 5 2 10 M Current reserves strong however can organise facility with the bank 4. Technical know how of some staff may not be sufficient 3 4 12 M Majority of technical staff have knowledge. Commence training programme for other staff members. 5. IT systems storage capacity may be an issue 3 3 9 M Conduct review to determine needs and upgrade if required 6. Service not acceptable to new client 1 4 4 L To be managed as part of client management process. Do not anticipate difficulty due to rigorous pre qualification process.
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