23 24 Contract Analysis Identifying potential exposures to risks by reviewing

23 24 contract analysis identifying potential

This preview shows page 23 - 32 out of 40 pages.

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24 Contract Analysis Identifying potential exposures to risks by reviewing, studying and analysing the contracts into which the firms enters. Emphasis is on contractual liability E.g.: Construction contracts Sales contracts Lease contracts Employee contracts
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Incident Analysis / Incident Investigation Basis for incidents can be risks or uncertainties. Recording incidents in a register, conducting root cause analysis and periodically running some trend analysis reports to analyze incidents, can potentially enable new risks to be identified. 25
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On-site Inspections : Direct Observations Observing organization’s facilities and operations, through periodical personal visits to the locations and departments within the firm. Some risks may not identifiable with the tools, reports and data. Personal interaction with other employees will help to identify work related potential risks. 26
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This relatively simple technique may be used in the workplace in order to observe risky situations and hazards regularly. This method is also used by emergency services when attending to an emergency and is a form of dynamic risk assessment. It is also heavily used by Workplace Health & Safety professionals during inspections and audits. A risk aware culture and well trained staff will improve people’s ability to observe potential risks and implement controls before the risk eventuates into an incident. 27
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Planned interactions with other parties Risks can be identified through systematic and continuous interactions with: Individual employees Departments in the organization External suppliers and professional bodies outsiders rendering services to the organization involvement with professional organisations/publications 28
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Brainstorming Sessions Brainstorming is probably the most frequently used risk identification technique. The goal is to obtain a comprehensive list that can be addressed later in the qualitative and quantitative risk analysis processes. Risk team participation and face-to-face interaction with employees are needed to encourage open communication and trust, which are essential to effective risk identification. Without them employees will be reluctant to raise their risk concerns in an open forum. While smaller, specialized groups can perform risk assessment and risk analysis, effective and ongoing risk identification requires input from all the employees as well as related third parties. 29
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In a well facilitated brainstorming session, the participants are collaborators, comprising a team that works together to articulate the risks that may be known by some in the group. Facilitating a brainstorming session takes special leadership skills and in some organizations, members of the internal audit and ERM staff have been trained and certified to conduct risk brainstorming sessions. 30
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The usual rules of brainstorming apply: All the employees/ members of the project team should be actively involved.
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  • Summer '11
  • Prof.TharinduPerera

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