Transcript PRESENTATION - Peter Scott

Implementing an effective risk
management strategy based upon
knowledge
Peter Scott
What is Risk?
“Chance of bad consequences”
The concise Oxford Dictionary
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What is Knowledge?
“The sum of what is known”
The concise Oxford Dictionary
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An integrated strategy
Risk
Knowledge
Management
Management
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Law Firm Risks
Operational
Management
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Risk/KM
Risks are inter-related
Failure to manage knowledge involves
widespread risk
KM is an essential part of an integrated
risk management strategy
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Example: Reputational Risk
Operational
People
Regulatory
IT Competition & Business
Markets
Economic, Political & Fiscal
Financial
Assets
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Law Firm Risks
Operational
Management
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Management Risks
Is your management in control of its
knowledge and managing your risk?
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Your Risks?
Where does the knowledge relating to
your risks reside?
Can you access it?
Can you capture it?
Can you maintain and upgrade it?
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Implementing a Risk Strategy
DIAGNOSIS
Identification and
assessment
MITIGATION
Control, transfer
and avoidance
MONITORING
Tracking and reporting
When a risk crystallises
LIMITATION
Minimising the effect
of crystallised risks
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Risk Identification Involves:
Being management driven
Brainstorming
Facilitated discussions
Questionnaires
Top down/bottom up
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Risk Diagnosis
Set criteria for
assessing risks
Identify
detailed risks
Identify high
level risks
Assess severity
of detailed risks
Assess severity of
high-level risks
Risk
map
Risk
summary
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Risk Assessment
Incidence - probability
Impact - severity
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Risk Mapping
IMPACT
High
High impact/ low incidence
High impact/ high incidence
Low impact/ low incidence
Low impact/ high incidence
Low
Low
High
INCIDENCE
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Risk Mitigation
Designed to:
Reduce
Avoid
Accept
Transfer
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Risk mitigation
Risk
map
Risk
summary
Consider
impact/probability
correlation
Consider available
mitigation
techniques
Residual
risk
summary
Contingency
plan
requirements
Insurance
requirements
summary
Required
controls
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summary
Monitoring involves
Tracking and reporting
Comparing actual outturns to preset
indicators
Confirming effectiveness of risk
responses
Reporting compliance and exceptions
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Risk monitoring
Required
controls Contingency
summary
plan
Insurance
requirements requirements
summary
Set risk indicators
and methods to
monitor them
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Annual Risk
Management
Report
Limitation involves
Risk crystalisation scenarios
Contingency plans
Limitation procedures
Post event assessment
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Use of IT
Use an integrated risk management
system to quantify, assess and control
risk by :
streamlining diagnosis, mitigation and
monitoring
 embedding common risk management
procedures
 providing information access to all who
need it
 creating and maintaining one central, up
to date risk PETER
database
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
Example – Risk Summary – an
overview of risks
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Example – Detailed Risks
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Example - Controls
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Example - Questionnaires
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Example – Final Evaluation
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Advantages of a formal risk
management process?
Structured approach focuses on key
risks
Elimination of redundant procedures
Comfort / assurance to PI insurers
Universal application to all risk areas
Continuous monitoring ensures
management of risk is “lived” day to day
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Risk/KM
Risk
Knowledge
Management
Management
PETER SCOTT CONSULTING
Implementing a Risk Strategy
DIAGNOSIS
Identification and
assessment
MITIGATION
Control, transfer
and avoidance
MONITORING
Tracking and reporting
When a risk crystallises
LIMITATION
Minimising the effect
of crystallised risks
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Any questions?
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