Treat Risks

The activities associated with the identification, conceptual design and concept testing for solutions that will address the risk exceeding the Appetite.

Avoidance A risk treatment strategy attempting to reduce the probability to 0 (zero) by avoiding policies, practices and processes that lead to occurrence of the risk event; Eliminate the risk completely. Examples include: Move a warehouse outside the risk area (earthquake, congestion), exit the market.
Loss Prevention A risk treatment strategy attempting to minimize the losses by addressing the cause; Limit occurrence of risk events. Examples include: Increased security for high-theft items, supplier certification.
Loss Reduction A risk treatment strategy attempting to reduce the losses resulting from the risk event; Limit the results per event. Examples include: Insurance, sprinkler installation.
Isolation/Separation A risk treatment strategy attempting to contain a risk event in a single instance (market, product, supply chain, plant, warehouse); Contain the results.
Duplication A risk treatment strategy attempting to limit the losses by establishing backup processes; Contain the risk event. Examples include: Information systems redundancy, overflow warehouses, emergency protocols for natural disasters, dual-sourcing strategy.
Diversification A risk treatment strategy attempting to spread the risk over many; Limit the impact of risk events on the bottom line. Examples include: Omni-channel, industry diversification.

Notes

OpenReference recommends adoption of ISO 31000 processes to build Supply Chain Risk Management governance processes, systems and behaviors. G3 provides the processes to describe an enterprise's SCRM processes. ISO 31000 is copyright ISO.

Compare to: ISO 31000:2009:5.5 Risk Treatment. Supply Chain Risk Management Risk Register

Hierarchy

ID	Name	Level	x
G3	Manage Supply Chain Risk	2	G3
G305	Treat Risks	3	G305

Term(s)

ID	Name	Clear	x
Risk Register	Risk Register		Risk Register
SCRM	Supply Chain Risk Management		SCRM

Workflow

From

Input(s)

Process

Output(s)

To

wf_process	wf_arrow
G304	Risk Register

G305

wf_arrow	wf_process
Risk Treatment Plan	A209
Risk Treatment Plan	A308
Risk Treatment Plan	A408

Treat Risks Manage Supply Chain Risk 4230500 3 Treat, Classification, Avoidance, Loss Prevention, Loss Reduction, Isolation/Separation, Duplication, Diversification, Risk, Management, SCRM, Supply Chain, Governance Identification, conceptual design and concept testing for solutions that will address the risk exceeding the Risk Appetite