Risk Management

The topic of Risk Management often seems overwhelming. The reason for identifying risks is so that you can mitigate them and prevent bad things from happening.

Consider breaking down risks into different buckets. I categorize risk into three areas: Business, Product, and Compliance risks.

What are some of your business risks?  Not securing funding? Lawsuits from competitors? Losing consumer trust?

What are some of your product risks? Do the products have defects? Can people get hurt or could die?

What are your compliance risks?  Not being able to sell products because you do not have the regulatory approvals?  Not being able to see because your regulatory approval was revoked?

Risks can overlap and have interdependencies. For example, defective software that inadvertently causes a plane to crash can lead to the FCC grounding your planes and thus impacting your revenues from plane sales. Your risk identification team should be composed of people who represent the business (management), product (engineers) and compliance areas to assure a holistic and balanced approach.

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