- Many risks can be completely eliminated and therefore should be in place to handle risks in case they happen.
- Risks probability may be low or high impact. It may too unlikely to justify costly measures to prevent it or high to justify planning for mitigation if it does occur.
- Risk mitigation is more effective when proactive than when reactive. Risk mitigation requires systematic planning, resource deployment and lead time for implementation all of which may be in short supply once a risk event has occurred or is in the midst of occurring.
Contingency planning is based on having plans and resources ready and waiting to be put into action when triggered. The purpose of a contingency plan is to allow an organization to return to its daily operations as quickly as possible after an unforeseen event.
Contingency plan protects resources, minimizes customer inconvenience and identifies key staff assigning specific responsibility in context of recovery.