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Headline Risks: Seeing the Big Picture

Risk Doctor Briefing

SERIES ARTICLE

Dr Dale Cooper

The Risk Doctor Partnership

Australia

 



Risk assessments are often undertaken in detail, or several assessments are conducted in different parts of an organisation, project or program. Detail may be appropriate for tactical decisions and specific treatment planning, but there is often too much detail to support high-level decision-making.

A headline risk makes sense of a large amount of detail by providing a summary of what might happen and what the consequences might be. It can either be developed bottom-up from a set of detailed risks that have common features, or by taking a top-down perspective to find risks that are caused by organisational-level sources or external sources that are not apparent from lower levels.

The benefits of using headline risks include:

  • The summary leads to a high-level understanding of the important risks for the organisation, supporting strategic decisions and allowing corporate risk treatment to be dealt with confidently.
  • ‘De-cluttering’ a large and sometimes messy set of risks generates a list that is more manageable, highlighting common themes that affect several parts of the organisation and facilitating clearer decisions.
  • Consolidation can detect systemic or common-cause risks that might otherwise remain hidden because individually they have moderate or low levels of risk, allowing them to be addressed coherently.
  • The high-level view of risks, and the understanding that is generated, provides managers with greater confidence as they approach and make decisions.

Developing headline risks can be particularly useful in the following circumstances:

  • Risk assessments are often undertaken for individual business units in an organisation, or individual projects in a program or portfolio. An organisation also needs to understand how uncertainty affects it as a whole, but individual risk registers are not always best suited for this.

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About the Author


Dr. Dale Cooper

New South Wales, Australia

 

Dr Dale Cooper is a highly skilled practitioner in the field of enterprise, strategic and project risk management, with over 35 years’ experience as a senior line manager and an international consultant. He has been a Director of Broadleaf Capital International since 1991.

Dale Cooper is a member of the Standards Australia Joint Technical Committee OB-007 that developed the risk management standard AS/NZS 4360, used as the basis for the international standard ISO 31000, Risk management –- Principles and guidelines. He is a Nominated Expert for Australia on IEC Technical Committee 56, Dependability. He was the lead author of the international standard IEC 62198, Managing risk in projects — Application guidelines.

He has been the independent Chairman of two Audit and Risk Committees and an independent member of two others. He is currently an independent member of the Audit and Risk Committee for the NSW Office of Environment and Heritage.

From 1984 he worked as an international consultant in the finance sector in London, as Joint Managing Director of a stockbroker in Sydney, and then as National Manager International Services at Standard Chartered Bank Australia, where he ran trade finance and priority banking and was a member of the Bank’s Executive Committee.

Previously he was a Research Fellow at the University of London and later on the academic staff at the University of Southampton. He received his PhD in operational research from the University of Adelaide. Dale Cooper is a Fellow of the Australian Institute of Company Directors, a Fellow of the Financial Services Institute of Australasia, a member of the Society of Petroleum Engineers and a member of the Society for Risk Analysis.

Dale Cooper has written many professional papers and several books on risk management. His most recent book, Project Risk Management Guidelines: Managing Risk with ISO 31000 and IEC 62198, written with colleagues from Broadleaf, was published by John Wiley & Sons in March 2014. He can be contacted at [email protected]