Risk assessment
Risk assessment
Risk assessment definition
Risk assessment is the process of identifying, analyzing, and evaluating potential risks that may arise from the use of technology or the implementation of tech solutions in a particular context. The goal of risk assessments is to understand the likelihood and potential impact of a particular event occurring and to determine appropriate strategies for mitigating or managing those risks.
See also: key risk indicator
Risk assessment typically involves these steps:
- Identify the potential risks. This involves finding and identifying all the possible risks that could arise from the use of technology in a particular context.
- Analyze the risks. Once potential risks have been identified, they must be analyzed to determine the likelihood and potential impact of each risk event.
- Evaluate the risks. Based on the analysis, the risks are evaluated to determine which of them are most critical and require immediate attention.
- Develop risk management strategies. After evaluation, appropriate management strategies are developed to mitigate or manage the risks.
- Monitor and review. Risk assessment is an ongoing process, and risks must be continuously monitored and reviewed to ensure that the management strategies remain effective and up-to-date.
What kinds of risks are usually assessed?
- Cybersecurity risks: hacking, phishing attacks, malware infections, and other types of cyber attacks.
- Data privacy risks: unauthorized access, theft, or loss of credit card, medical, and other types of personal data.
- Regulatory compliance risks: failure to comply with GDPR, HIPAA, or CCPA.
- Business continuity risks: major disruptions, like a natural disaster or a cyber attack.
- Financial risks: the cost of recovering from a cyber attack or the loss of revenue due to a system failure.
- Reputational risks: negative publicity or damage to brand image due to a data breach or other type of security incident.
- Human risks: human error or intentional misconduct by employees, which can result in security incidents or other types of operational failures.