This document discusses risk management. It defines risk as an event with possible negative consequences. Risk management aims to prevent risks, minimize their impact, and transfer some risks through diversification and insurance. The key steps in risk management are to identify potential risks, analyze them through quantitative or qualitative methods like risk matrices or brainstorming, and then take action to address risks by planning solutions, implementing them, and monitoring risk levels. While some risks should be avoided, taking carefully managed positive risks can also provide benefits.

1. Risk management
(in simple)
by
Aurora Computer Studies
(auoracs.lk)
Aurora Computer Studies 1

2. Agenda
• What is a risk ?
• Why manage?
• How to manage?
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3. What is a risk?
1. A risk is an event with possible bad
effects !
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4. Examples of risks
• You may slip while walk in the path.
• Your data may be lost due to crash of
laptop.
• Your new business may not generate
expected profit.
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5. Why manage?
• To prevent (if possible)
• To prepare and minimize the affect
• To transfer (at least some of) the
affect
o Diversify investments
o Use of insurence
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6. The big picture
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Risk
Issue
Manage
Manage
Prevented

7. Is risk always bad?
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• Risks are not always bad
• It is undue risks that are bad
• Taking some types of risks are fun
and exiting.
o It is part of some sports and adventure type hobbies

8. Positive risks
• Business and entrepreneurship
• Explorations and research
• Risks taken to prevent greater risks or
possible disasters
• Risks taken for the benefit of the
majority
• Adventure sports
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9. Positive risks – how to?
• Manage it !
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10. Types of personalities
• Risk seeking
o Enjoy taking risks
• Risk aversive
o Do not like take risks
• Risk neutral
o Moderate atitude
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11. How to manage risks?
Identify Analyze
Action
•Plan
•Do
•Monitor & control
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12. 1-Identify risks
• Consciously think about possible risks
for a given task and list those
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13. 2-Analyze risks
• Analyze each risk separately
• Two approaches;
o Quantitative risk analysis
o Qualitative risk analysis
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14. Quantitative risk analysis
• Use of risk matrix
• Expected Monetary Value (EMV)
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15. Use of risk matrix
• Use of risk matrix
o Severity of the risk
o Probability of the risk
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16. Expected Monetary Value (EMV)
• Quantify positive and negative
outcomes in monetary terms with
probability and calculate the overall
outcome.
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17. Expected Monetary Value (EMV)
• Example:
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18. Qualitative risk analysis
• Brainstorming
• Delphi technique
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19. Brainstorming
• Relevant stakeholders and preferably
experts brainstorm to analyze the
identified risks
• Result is the prioritized risks list
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20. Delphi method
• A structured communication technique
which relies on a panel of experts.
• The experts answer questionnaires in two
or more rounds.
• After each round, a facilitator or change
agent provides an anonymized summary of
the experts' forecasts from the previous
round as well as the reasons they provided
for their judgments.
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21. Delphi method (cont..)
• Thus, experts are encouraged to revise their
earlier answers in light of the replies of other
members of their panel.
• It is believed that during this process the range of
the answers will decrease and the group will
converge towards the "correct" answer.
• Finally, the process is stopped after a predefined
stop criterion (e.g. number of rounds,
achievement of consensus, stability of results)
and the mean or median scores of the final
rounds determine the results.
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22. 3 - Take actions
1. Plan the solution
2. Implement the solution
3. Monitor the risk level
o If success
• Remove the item of the risks list
o If failed
• Start managing the issue !
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23. Thank You !
Presented by
Nalaka Gamage
Aurora Computer Studies
(auoracs.lk)
23

24. “If you risk nothing, then you
risk everything."
~ Geena Davis
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25. Premier Study Center
Aurora Computer Studies,
Summerset College,
# 135, 3rd Floor,
DFCC Building,
High Level Road,
Maharagama.
City Study Center
Aurora Computer Studies,
Summerset College,
# 88/2, 2nd Floor,
BOC Building,
High Level Road,
Kirulapone, Colombo 06
Details and enquiries :
Call - 0719 842030
E-mail – info@auroracs.lk
Web - www.auroracs.lk
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