Risk Management Procurement,
Procurement Risk Management Guide
Procurement Risk Management
A Guideline for Managers
This guideline provides information and practical advice on risk management in the procurement of goods and services.
This guideline will help you to understand: * what risk management in procurement is * the key components of risk management * the process of risk management * how to develop a risk management plan.
What is risk management in procurement?
Risk management in procurement is about ensuring potential risks associated with the purchase of goods or services are identified, assessed and managed to ensure unexpected or undesirable outcomes are minimised while achieving maximum benefit from the procurement.
Key components of risk management
Three key principles in managing risk in procurement are: identifying risks – considering potential risks associated with the procurement assessing risk – understanding the nature of the risk, likelihood of the risk occurring and the consequence or impact it may have managing risk – identifying possible controls, courses of action, creation.
Risk management process
Depending on the nature of the procurement, the level of detail required and the management of risk will vary.
The following list identifies key steps in the risk management process:
1. communication and consultation
2. establishing the context
3. risk identification
4. risk analysis
5. risk evaluation
6. risk treatment
7. monitoring and review .
The following overviews the key steps and how they potentially relate to procurement activities. For further information on risk management refer to ISO31000: Risk Management, Principles and Guidelines Risk Management Standard.
1. Communication and Consultation
Ensure appropriate communication and consultation is undertaken with internal and external stakeholders. This is relevant for all steps in the risk management process and promotes a common
Procurement Risk Management
A Guideline for Managers
This guideline provides information and practical advice on risk management in the procurement of goods and services.
This guideline will help you to understand: * what risk management in procurement is * the key components of risk management * the process of risk management * how to develop a risk management plan.
What is risk management in procurement?
Risk management in procurement is about ensuring potential risks associated with the purchase of goods or services are identified, assessed and managed to ensure unexpected or undesirable outcomes are minimised while achieving maximum benefit from the procurement.
Key components of risk management
Three key principles in managing risk in procurement are: identifying risks – considering potential risks associated with the procurement assessing risk – understanding the nature of the risk, likelihood of the risk occurring and the consequence or impact it may have managing risk – identifying possible controls, courses of action, creation.
Risk management process
Depending on the nature of the procurement, the level of detail required and the management of risk will vary.
The following list identifies key steps in the risk management process:
1. communication and consultation
2. establishing the context
3. risk identification
4. risk analysis
5. risk evaluation
6. risk treatment
7. monitoring and review .
The following overviews the key steps and how they potentially relate to procurement activities. For further information on risk management refer to ISO31000: Risk Management, Principles and Guidelines Risk Management Standard.
1. Communication and Consultation
Ensure appropriate communication and consultation is undertaken with internal and external stakeholders. This is relevant for all steps in the risk management process and promotes a common
References: ISO31000: Risk Management, Principles and Guidelines