What is risk mitigation? (With job titles and salaries)
By Indeed Editorial Team
Published 22 June 2022
The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.
Risk mitigation has a significant impact on the success of both your business and its internal processes. This mitigation requires strong analytical and critical thinking skills. By knowing more about mitigating risks, you can reduce potential damage to your operations and profits. In this article, we discuss mitigating risks, discuss the difference between mitigation and avoidance, provide you with a guide to help you mitigate risks and discuss six jobs that require or use risk mitigation.
What is risk mitigation?
Risk mitigation refers to actions and initiatives you implement to reduce risk within your team and to eliminate threats to your initiatives. This mitigation also aims to reduce the likelihood of risks occurring again. Companies face various risks throughout their life cycle, like strategic risk, compliance risk, operational risk, financial risk and reputational risk. Organisations increase their chances of success by assessing and mitigating risks that can damage their reputation, daily operations, profits and security. Mitigating risk also reduces your overall liability when issues arise that involve your products and overall business.
The difference between risk avoidance and mitigation
Risk avoidance strategies focus on eliminating particular risks rather than reducing their effects on organisations. For example, some organisations terminate projects that have high risks to avoid those risks entirely. Risk reduction requires an analysis of the organisation to determine where you can reduce risks.
How to mitigate risks
Here's a guide to help you mitigate risks:
1. Assume and accept risks
This requires collaboration between team members to identify risks within projects and to determine whether they can accept those risks. This strategy is common among those who want to assume risks about project output and to provide colleagues with information about potential risks. Here's how you can use this strategy for common risks:
Risk that impacts cost
When you observe risks within companies that impact cost, this requires you to readjust your budget. For example, project teams can implement the accept strategy to identify risks associated with your project's budget and to determine a plan for adjusting that budget. This ensures that your project remains within the accepted budget and that all members of your team know the potential risks.
Risk that impacts schedule
This type of risk impacts your scheduling, which corresponds to your deadlines. When you identify risks that can impact your team's ability to meet deadlines, this suggests a requirement for task adjustment or a deadline extension. For example, some leaders and teams may decide to reassign tasks to ensure that those with skills or expertise in particular areas accomplish tasks associated with those skills.
Risk that impacts performance
Risk that impacts performance typically involves issues that negatively impact productivity and performance. For example, issues with software and goods negatively impact your team's ability to perform effectively. When your team has increased awareness of potential risks, they can reduce the impact on their performance.
2. Use risk avoidance
Risk avoidance uses the accept and assume risk strategy and provides opportunities for avoiding those risks. Some methods of risk avoidance require you to plan for potential risks and implement measures that avoid them. For example, mitigating risks on new product production requires product testing to avoid the failure of products. This occurs before the approval of final production. Here are some ways to implement this strategy:
Risk that impacts performance
Mitigating risks on performance, like insufficient resources, inadequate designs or weak dynamics between team members, allows teams to identify potential risks and issues. This requires collaboration among all team members. For example, production teams test durable product materials to determine whether products have the additional risk of damage due to poor material performance. Project managers may also identify risks within their team dynamics to determine the best ways to avoid issues among team members.
Risk that impacts schedules
Consider how you can avoid risks that impact the company schedule by identifying issues with deadlines and tasks. Risks that impact your deadlines include unrealistic expectations of your abilities. You can avoid risks that impact schedules by contributing additional time to tasks and responsibilities. This ensures that if you experience issues with your projects, you already have time to solve those issues.
3. Control risk
You may want to use this strategy when mitigating risks because it helps you either reduce or eliminate risks. This prevents damage to the company and your projects. For example, risks that impact costs may require you to focus on project management and obtain insight into how you allocate funds. Consider how your team can identify risks before they occur to reallocate funds and eliminate the risk to your budget entirely.
4. Transfer risk
This mitigation strategy requires you to consider the consequences of risks and transfer both the strain and consequences of risks of other parties. The drawback of this strategy is that you typically want your strategy to include all team members. To do this, collaborate with multiple departments and determine where you can transfer risks.
5. Watch risks
You can monitor your projects and observe potential risks, along with the consequences of those risks, to identify potential changes that affect your risk's impact. Your team can use strategies that monitor the cost, scheduling and performance of projects. You typically don't act on risks as much as you do with other strategies.
6 jobs that require you to mitigate risks
Here's a list of jobs that require you to mitigate risks:
Average national salary: £42,460 per year
Primary duties: Environmental compliance specialists consider local legislation regarding environmental laws for resources like water, gas, energy and oil. They also assist with environmental regulations. They also provide companies with technical assistance for health regulations, along with the potential risks associated with current regulations. These professionals require strong reporting abilities, along with attention to detail and the ability to interpret data.
Average national salary: £34,710 per year
Primary duties: Loss control consultants inspect businesses for insurance companies. They also prevent loss through recommendations and reduce the impact of losses that occur. These professionals evaluate the safety of businesses, along with their strategies to prevent potential thefts and inventory losses. They do this by conducting routine analyses and evaluating the compensation of employees. By identifying potential losses, these professionals reduce overall risk and empower companies to avoid both the occurrence and severity of those risks.
Average national salary: £45,627 per year
Primary duties: Compliance consultants help healthcare organisations that want to achieve conformity with their local government's regulations. These professionals have extensive knowledge of both their government's regulations and the regulations of regulatory boards. Compliance consultants advise senior and upper management on the appropriate processes to follow. They also promote compliance across companies with local laws. This role helps reduce risk by determining the present risks in products and projects. This allows companies to establish protocols and reduce or eliminate risks.
4. Risk analyst
Average national salary: £43,419 per year
Primary duties: Risk analysts determine the potential consequences of business actions. These professionals read and analyse the financial data involved in projects. They also develop visual models of data and present potential outcomes to their clients and members of upper management. Risk analysts identify risks that can have negative impacts on organisations like banks and investment companies. They typically specialise in specific industries to ensure accurate predictions of trends.
Average national salary: £61,917 per year
Primary duties: Model risk specialists analyse the internal data of organisations and their products. These professionals also implement risk management models and collaborate with marketing and sales teams. They complete independent validations of product models in a company's inventory. These professionals manage validation resolutions with both owners and users. They also endorse management plans and oversee remediation progress.
Average national salary: £53,700 per year
Primary duties: Regulatory affairs managers prepare, coordinate and supervise submissions according to regulations. These professionals aim to protect public health by maintaining the safety of products and ensuring that they have limited risks. They work with pharmaceuticals, veterinary medicines, medical devices and various industries that impact the public. Regulatory affairs managers implement various strategies that help meet regulations. They use critical thinking, writing skills and organisational skills. Their goal is to ensure the accuracy of products.
Salary figures reflect data listed on Indeed Salaries at time of writing. Salaries may vary depending on the hiring organisation and a candidate's experience, academic background and location.
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