Managing the project risks includes various activities, tasks, and execution plans so that we can prevent any uncertain events that hinder the flow of the project. But, one of the most essential tasks in any risk management process is the assessment and evaluation of the risk mitigation plans. This gives a clear idea about the efficiency of risk response actions and the status of the various project issues.

So, let us walk through this detailed guide on the Last Step of the Composite Risk Management Process so that we can learn how to properly assess and evaluate the risk.

The Five Steps of the CRM Process

Let us understand the process of Composite Risk Management so that we can easily understand its last step of evaluation and assessment of the tasks. The Process has five main steps which are described as stated below.

Step 1: This step Identifies all the possible hazards during the mission along with all the aspects of future situations, the environment, and previous problems.

Step 2: In this step, the commanders or supervisors assess the risk to determine risk decisions. This helps us to know what will be the impact of each hazard in terms of potential loss and cost. Additionally, the probability and severity levels are also assessed.

Step 3: The next step is to develop a control plan and make risk response decisions. We can either eliminate the risk or accept the risk by controlling them. It is important that controlling the risks should not lead to comprising the essential mission values. Some risks are controlled by altering the task, changing location or route, increasing supervision, wearing protective clothing, changing the time of operation, etc.

Step 4: This is the implementation step in which we take actions that eliminate the hazards or reduce their risks. The leaders also integrate procedures to control risks into plans, orders, SOPs, lesson plans, risk reduction measures, etc.

Step 5: The last step includes standards and controls to evaluate the effectiveness of action plans. Its goal is to know what actions are in place and what standards are expected, then hold those in charge accountable for implementation from start to finish.

But, there is some more with the last step. It broadly includes two phrases namely Monitoring and evaluation.

The Last Step: Supervise and Evaluate

1. Supervise

This phase involves continuous monitoring of the control plans that have been implemented by the leaders. The severity of the risk may vary according to the environment. Thus, it is important to carefully watch whether the risk-response plans are working properly or not. This phase carefully keeps track of various risks such as complete mission failure, severe workflow breakdown, and Degraded mission capability so that timely actions can be taken.

Why it is Important to Supervise and Monitor?

Generally, Composite Risk Management focuses on avoiding unnecessary risks. But if the risk event offers advantages that are more than the cost of handling it, it is recommended to accept it. However, the cost of risk acceptance may become higher than the advantages in the future.

This is the reason monitoring the risk is important. It includes various roles and responsibilities covered in the next subsection. In this way, Supervision and Monitoring allow us to identify the control failure.

Roles and Responsibilities:

1. Maintain Regular Oversight: Ensure the consistent check on the action plans or risk response plan.
2. Identify Red Flags: Highlight the scenarios in which the action plan seems to be inefficient.
3. Coordinate with Team: Ensure collaboration among the team and keep all the members informed about the various red flags.

2. Evaluate

After we established the monitoring actions, it is now time to evaluate the various actions, strategies, and plans that we took to overcome the risks. Evaluation helps us to understand the difference between what we implemented and what is needed to mitigate the risks.

We can evaluate a control plan qualitatively as well as quantitatively in the last step of the Composite Risk Management Process.

Why Evaluation is Important?

The accountability of the control plans depends on their detailed analysis in terms of efficiency as well as relevancy. Thus, we can refine the action plans using the proper evaluation. So, evaluation plays a crucial role in maintaining the responsibility, authority, and accountability of our Risk management process.

Role and Responsibilities:

1. Conduct Performance Analysis: Check whether the action plans delivered the expected results or not.
2. Extract insights for future decisions: Identify the patterns in the performance data and use them to make future strategic decisions.
3. Document the results: Document the entire evaluated result so that various stakeholders can be kept informed to give feedback or opinions.

Benefits of Effective Supervision and Evaluation

Whether the project is related to IT or any other sector, there are always some uncertain events or issues that affect our smooth workflow. Thus, Composite Risk Management helps us to identify and resolve those risks. It serves the following advantages:

1. It highlights hazards as well as actions: The last step of the CRM process not only helps us to identify the hazards that can injure or kill personnel in the force but also highlights the action plans to avoid those risks.
2. It has multiple levels of risk management: It includes three levels for managing the risks namely Time-critical, Deliberate, and Strategic. These various levels help us to prioritize the risks according handle them easily.
3. It helps us to optimize the resources: We can identify the risks using CRM which helps us find out where to locate the resources and how much.
4. It ensures compliance with standards: If the risks are prioritized and handled effectively, we can become compliant with all the necessary industry standards and regulatory compliance. Hence, CRM enables us to earn the trust of customers.
5. It is widely applicable: Composite Risk Management has different significance for the respective domains in which it is being applied. However, the goal of both the process is to identify, analyze, and mitigate the risks associated with the project.

Conclusion

In conclusion, we can say that each step of the Composite Risk Management Process has a detailed set of activities for identifying, analyzing, and rectifying the project risks. However, the last step completes the entire risk management process by listing out the performance-based results of the action plans. We also learned how the Composite Risk Management Process differs from the generic Risk Management Process.

Now, you are equipped with a sufficient amount of knowledge that will help you to efficiently complete your entire Composite Risk Management Process.

FAQs

1. What is difference between the Risk management and Composite Risk Management?

Both processes are related to risk and their mitigation. But there is a slight difference between them. In General, Composite Risk Management is specifically used for the military and organizational settings. On the other hand, the term ‘Risk Management’ is generic to various contexts.

2. How many types of Risks are there in Composite Risk Management?

There are generally four types of Risks listed on the Composite Risk Management. They include Extremely High Risk, High Risk, Moderate Risk, and Low Risk. The leaders or supervisors at different levels manage them according to the risk level.

3. What are the components of Risk in Component Risk Management?

The Exposure, Severity, and Probability constitute a Risk out of which the Expsoure gives us the knowledge of Time, Proximity, Volume, and Repetition. Along with these, the severity is ranked as Catastrophic, Critical, Marginal, and Negligible and the probability is labeled as Frequent, Likely, Occasional, Seldom, and Unlikely.

4. What is Risk Severity in the CRM Process?

Risk Severity tells us about the intensity at which the risk can affect the flow of the project. Thus, it provides us with a way to know the worst possible outcome of any risk in the project activity. The ranking of the Risk Severity is done as Catastrophic, Critical, Marginal, and Negligible.

5. How to use a Risk Assessment Matrix in Component Risk Management?

The leaders or supervisors use the Risk Assessment Matrix as a visual tool to assess the Risks in the Component Risk Management. It simply highlights the risks, their level along with their probability level so that it can be easy to prioritize the control actions.