TPP Finance Breakfast Seminar - Risk Management

1. Risk and impact
Kate Sayer
May 2014

2. Traditional approaches
 Identify all the risks you can think of
 Rank them for impact and likelihood
 Multiply the factors to prioritise risks
 Present in a risk register
 Variations on this?

3. What are the drawbacks?
 Spurious accuracy – numbers are misleading
 Different levels need different formats –
operational versus high level strategic
 Risk registers require you to pinpoint a risk
event – this is unrealistic
 Creates illusion that you are managing risks by
this process

4. A different approach
 Focus on the management of risks
 Work on organisational capability to respond
to unforeseen events
 Differentiate risks
 internal, predictable and we can act to prevent
the event occurring
 external and outside our control or arising from
the strategy

5. Operational risks
 Managing day-to-day risks is part of the
normal management job
 Managers describe the actions and processes in
place to manage risk
 Then map back to the risks
 Identify gaps or overlaps
 Assess how effective these actions are
 Notes on further actions or changes

6. Framework
6
Controls - procedures Risks
Aims and objectives
Planning
Accountability
Training
Systemic
Monitoring
Staff welfare
External review

7. Strategic risks – for SMT
 Focus on external risks and risks arising from
the strategy
 Cannot easily be assigned to one team
 More likely we will have to respond rather
than control
 Possibility of high impact events
 Likelihood difficult to assess – too subjective

8. Strategic risk register
 Identify major risks and impact
 Consider responses and how to manage
 Assign responsibility for management of risk
 Regular reporting and monitoring of risks

9. Getting to better impact
Impact = outcomes
resources put in
Increase the
volume or quality
of outcomes and
outputs
Reduce the level
of resources (time
and effort) put in

10. What can we affect?
Which
beneficiaries
we work with
What we do How we do it Who does it How long Outcomes
Elements of cost

11. Improving outcomes
 At any given point, there
are a range of possible
outcomes
 How can you enhance
the chances of the route
to better outcomes being
chosen?

12. Improving outcomes
Performance target
Control anger towards children for 6
consecutive months
Outcome
All children live in safe, non-violent, nurturing homes
Parenting
programme
Target for
individuals on
programme
Improve
parenting skills

13. Tracking causal links
Call for an appointment for parenting programme 100
Appear for an assessment and first session 60
Attend first three and demonstrate new skill 40
Attend all sessions and demonstrate 3 skills 25
Control anger for 3 months 15
Control anger for 6 months 13
No. peopleMilestones

14. Reduce time and effort put in
 Understand what is already good and could be
even better
 Look at contribution made by activities to
outcomes (outputs)
 What does not contribute and we could stop
doing?

15. Leave it to luck?
Or manage your luck…