Prioritising Risks and Opportunities on the same scale
Although the Management System Standards expect you to prioritise your risks and opportunities (essentially planning) how can this be achieved? When should an opportunity take precedence over a risk? This article provides a methodology to assist with assessing and prioritising risks and opportunities on the same scale.
According to ISO 31000 risks can be positive too, but how can you assess an opportunity in terms of likelihood? The likelihood of an opportunity eventuating if you do nothing as opposed to something? Well duh, of course if you do nothing it’s unlikely to eventuate. If it eventuates without you doing anything then is it really worth logging? The likelihood of your actions bringing about the consequences? Well that surely depends on what you do. ISO 31000 provides no guidance.
If we assume that assessing the likelihood of an opportunity is problematic and what we are trying to do is take advantage of the great opportunities first then we need a different assessment method.
Instead of likelihood why not consider effort? Low effort is good and high effort is bad. That way we focus on the opportunities we don’t have to do much to get through and if we combine this with a consequence assessment focused on value then we develop an easy assessment methodology.
Aligning Risks and Opportunities
So we now can align the results of opportunity assessments against what a basic risk matrix would generate, but do we want to? Do we want to consider an opportunity with the rank of high as the same as a risk with the rank of high. I would suggest generally not – I’m not sure that SafeWork or the EPA would approve to highly of that approach. As such you could document that an opportunity shall never take precedence over a similarly ranked risk, but this requires people to remember to implement it.
Much better if the opportunity matrix is less likely to compete with risks in the first place so something like the following may be better.
When comparing the Revised Opportunity Matrix with the Basic Risk Matrix above you can see that we have reduced the likelihood of the Opportunity Matrix producing a High result, therefore we should generally be putting risks ahead of opportunities.
Combining the learning from this article with the Integrating Quality and Environmental requirements into the Hierarchy of Control would allow you to develop a single methodology for the management of safety, environmental and quality risks and opportunities.