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Documenting your Risk Management Policy

October 13 2011

Documenting your risk management policy is the first step in being prepared for these unwanted events involving your project. This can now be done easier than ever before because of the advent of the project management templates that are now in use in the business world.

The template for creating your risk management policy follows the latest path being used by companies to mitigate the impact of risks to their projects. This is all in an effort to minimize the damage potential in both time and monetary costs the impact of risks inflict on projects. This will help keep the project on schedule and within its budget to give it a chance at being considered a success.

The first step in the creation of a risk management policy is to know and indentify all possible risks that could possible inflict damage to your project. With this list the project manager can then prioritize them accordingly. Things that must be considered are their impact potential and the impact damage of risk on the project.

With the formation of the risk management policy and all of the known risks are identified and prioritized, the mitigation of them can commence. Each of the risks will need a separate approach to mitigating them since the natures of risks are independent of the project in which they encounter. The approach to each mitigation must match the risk in either deletion of the risk or replacing the monetary loss of the impact.

When considering the different paths the risk management policy can take on mitigation, the cost of path of interceding the risk has to be monetarily advantageous to the project. While nearly every risk can be mitigated to the point it will not have a negative impact on the project, there are some that the cost of this mitigation would exceed the impact damage itself. This is one place where total mitigation is not advisable.

Your risk management policy must fit your needs and budget of your project for it to be an effective tool of the management. This can be easily done with a risk management plan created by a well constructed template.