The Importance of Risk Assessment for Companies to Establish Partnership

Risk assessment is a process to identify potential threat and analyze what could happen. There are many threat that needs to be considered. For every one, many scenarios could happen, depends on time, scale, and location.

In a simple terms, risk assessment helps companies to enhance its security. But this deep evaluation offers more benefits for any companies.

Risk assessment helps to determine the possibilities of accidents and its consequences, also the tolerance of such occurence. The result of this process can be stated in quantitative or qualitative manner.

Risk assessment is an inseparable part of a broader strategy. It helps to reduce the concequences potential of a possible risk.

To understand more about the importance of a risk assessment for a company, these are 11 benefits you need to know:

1. Identify security vulnerabilities

Risk assessment will evaluate company's system by considering external and internal threat. In doing so, risk assessment will identify the vulnerabilities of company's security, inefficiencty, and disobedient to security standard. It benefits companies by creating a list of specific security problem and determine which problem has the biggest risk.

2. Determine a new security requirements

By understanding your organization's weakness, the next step of risk assessment is to determine steps to take to eliminate identified weaknesses and enhance security system.

3. Justify Expenses

Detailed risk assessment can help companies to understand financial risk from security breach. Also, risk assessment helps to calculate the cost of security upgrade and long-term financial benefits.

4. Smart Purchasing 

Risk assessment provides information that thelps to allocate budget efficiently. After figuring out your weaknesses, companies can allocate resources according to the problems. For example, risk assessment can prevent company to spend budget on a problem more than it needed.

5. Improve Planning

A company needs to understand the actual security risk to plan their architecture network in the future. So the identified strengths and weaknesses can provide valuable assist for company's improvement.

6. Documentation

Eventually, risk assessment and improvement can validate company's effort to run security steps. Risk assessment can be used as a proof for government regulator, insurance company, business partners, and so on that you use a necessary security to protect your data and network.

7. Trained Employee

Risk assessment also has value to improve employee's awareness of their action and security risk. This knowledge improvement can lead to efficiency. For example, an employee tend to use best practice in their daily job (avoid risky activities such as revealing password, or learn to detect suspicious activities).

8. Improving Motivation

The fact that a company did a risk assessment shows employees that securities need significant attention. Companies act like that so their employees can follow. Also, with a new understanding of the impact of security risk, employees can be motivated and improve their productivities.

9. Improve Communication and Decision Making

Risk assessment involves many people, therefore helps them to initiate conversation about security and its risk. Detailed information provided by risk assessment helps them to make decision. People in a company will be on the same page about the security risk and what to prepare.

10. Improve Productivity

Security review, process review, and upgrade planning help companies to achieve new knowledge and perspective of their system. As a form of self analysis, risk assessment also help companies to plan changes in the future regarding its security.

11. Helps to Determine Budget Options

If done by outside parties, risk assessment objectivity can help company to show their BoD the importance of spending for security. Also, provided information can help to estimate required budget for this security improvement.

Risk assessment helps to start improvement on organization's security framework, it also bring efficiency to other field like budget planning and team communication.

That's the importance of risk assessment for every division in a company. You need to be agile to detrmine steps and read the market over time to improve your business.

It's important to understand how to identify problems and develop creative solutions. Every employees can take Problem Solving and Decision Making program to sharpen their ability to make decision and minimizing risk of that decision.