Measurement is also applied to more abstract uses for example a paramedic may ask a patient to rate pain on a scale of 1 to 10.
However, any measure is pretty useless without a standard way of interpreting it. All parties must agree and maintain the units of measurement, whether that is inches, centimetres, minutes, hours, pints, litres or others.
Even in the paramedic example above, the scale must be bench marked, with 1 being comfortable and 10 being excruciating pain.
It could reasonably be argued that the standardisation of measurement has helped drive civilisation forward for centuries.
In risk management, measurement of risk is essential in order to give some indication as to the severity of each risk, enabling response priorities to be set.
It is also important to baseline risks in order to monitor how the risk changes after actions have been taken to reduce it, or as external factors change.
Many successful businesses consider risk in their day to day operations but what may be missing is the documented measurement and monitoring of those risks. Without it, it’s hard to tell if your risk treatment actions are having any effect, or just costing the business money.
Assent Risk Management is experienced in managing risks and our consultants have experience in a wide range of industries. We can help you set up a framework for measuring and controlling risk efficiently.
Contact us to see how we can help.