[Excerpted from "How to Conduct an Effective IT Security Risk Assessment," a new report posted this week on Dark Reading's Risk Management Tech Center.]

Many security and compliance projects begin with a simple idea: assess the organization's risk of vulnerabilities and breaches. Indeed, implementing an IT security risk assessment is absolutely critical to the overall security posture of your organization.

An effective security risk assessment can prevent breaches, reduce the impact of realized breaches, and keep your company's name from appearing in the spotlight for all the wrong reasons. Regular IT security risk assessments also enable organizations to build up a cache of historical data that can be used to effectively gauge and communicate monetary impact related to risks -- and, hopefully, convince upper management to take decisive action to reduce the organization's threat surface.

It's important to note that not every IT security risk assessment is alike -- or even remotely close. Indeed, there are many ways to perform IT security risk assessments, and the results may vary widely depending on the method used. It should also be noted that performing a risk assessment is a very small part of the overall risk management process.

There are basically three risk management components: