In this installment of our Risk Management Basics series, we’re going to learn about risk treatment.
If you’ve been reading our Risk Management Basics series, you know we addressed the Three Stages of Risk Assessment in a recent article. Risk Treatment is often the next step in the risk management process after risk assessment.
We’ll be writing more in this Risk Management Basics series, so if you’re liking it stay tuned. Plus, feel free to use the comments section at the bottom to ask risk-related questions or to suggest risk-related article topics for the series.
And finally, even though an organization can and should use risk management for all of its objectives, we want you to know we’ve got a free downloadable guide to using Risk Management for Occupational Safety and Health Management at the bottom of this article for you.
Risk treatment follows risk analysis in the risk management process and its goal is to select one or more option for addressing the risk and then implementing the option(s).
Risk treatment involves a five-step, iterative process that’s quite similar to the common PDCA cycle for continuous improvement (click that link for a free PDCA cycle infographic). The five steps of the risk treatment process are:
Let’s take a closer look at each aspect of risk treatment in the sections below.
Your risk treatment option(s) may lead you in any of the following directions:
Selecting the risk treatment option should include a consideration of factors beyond merely economic considerations and should always be made with the organization’s objectives, risk criteria, and resources in mind. When selecting a risk treatment option, balance the benefits of implementing the option and making progress toward achieving the objective against all costs of the risk treatment implementation.
Keep in mind to consider the values, perceptions, and involvement of all stakeholders when selecting a risk treatment option. In addition, you’ll want to select the best way to communicate and consult with them before, during, and after risk treatment.
Remember that risk treatments may not always produce the consequences intended, and may even create unintended consequences and/or new risks that you’ll need to manage. That’s why you’ll want to monitor and review your risk treatment during the evaluation phase mentioned below.
Next, create a plan for implementing the risk treatment. The risk treatment plan spells out how the risk treatment will be implemented. This helps all involved have the same understanding and helps you measure progress toward implementation.
Your risk treatment plan should include:
Once you’ve created your plan for implementing the risk treatment, follow the plan and implement the treatment.
Once you’ve implemented your risk treatment(s), you’ll want to monitor and review them to evaluate their effectiveness. Remember, this is something you should have prepared to do when creating your risk treatment plan, as described above.
Monitor and review your risk treatments at all points of the process. Be sure to clearly assign this responsibility so it’s carried out as necessary (again, see your risk treatment plan).
If your risk treatment is working as planned (or better), great. Stay the course. If it’s not working as well as planned, you may want to reconsider your risk treatment and/or add another risk treatment.
Don’t forget about our free PDCA cycle infographic, which is a nice reminder of the importance of evaluating the effectiveness of a change.
Always document all phases of the risk management process, including of course risk treatment and risk treatment evaluation.
Of course, you can hang tight for the next article(s) in our Risk Management Basic Series, but here are some additional resources for you if you want to kickstart your risk management awareness.
We hope you enjoyed and learned from this installment of our Risk Management Basics series.
Stay tune for more Risk Basics articles and let us know all your risk management questions. We’re open to suggestions for new article topics related to risk as well.
And even though you can use risk management techniques in relation to any of your organization’s goals, we invite you to download our free guide to risk-based safety management below.
Download this free guide to using risk management for your occupational safety and health management program.