The risk register is a document used for the strategic management of risk. These risks can include both opportunities and threats and should be identified early in the project and refined throughout. The approach allows for risks to be ranked in order to confirm resources are appropriately allocated and enables the joint management of risk between the project owner and other stakeholders.
Using the ‘Risk Register’
Step 1: A clear risk process is defined stating how often risks will be reviewed and who will be involved in the process.
Step 2: A template, or document is created for risk definition. It should contain the headings: ‘Current status’: Indicating whether a risk is currently an issue or has passed; ‘Risk name’: A title that is easy to refer to; ‘Risk description’: An unambiguous description of the risk; ‘Trigger’: An observable event that indicates the risk is about to take place or has already taken place; ‘Category’: A categorisation of the level of the risk, for instance, a business risk, project risk, or stage risk; ‘Cause’: Conditions or events that cause the risk; and ‘Risk owner’: Staff member responsible for monitoring and responding to the risk.
Step 3: A template, or document is created for risk analysis. It should contain the headings: ‘Result’: A description of the impact of the risk; ‘Probability/likelihood’: A qualitative or quantitative indication of how likely the risk is to occur; ‘Impact’: A qualitative or quantitative representation of the magnitude of the effect(s) of the risks occurrence; ‘Risk grading’: The risk score multiplied by its probability of occurrence’; and ‘Proximity’: An approximation of the point in time when the risk might occur.
Step 4: A template, or document is created for risk response. It should contain the headings: ‘Risk response’: Details regarding preventative actions, contingency actions, recovery actions, or options to transfer the risk; ‘Action date’: Dates on which response actions were executed or are planned for; ‘Response owner’: The staff member responsible for the planning, execution, and follow-up to the risk response action; ‘Cost’: The cost of the mitigation strategy. Each risk is allocated a portion of the budget to ensure that the value achieved through mitigation of the risk is not greater than the expense to the organisation.
Step 5: Completed risk registers are retained as a record of how risks and their management have evolved throughout the organisation’s history.
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