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Essay on Risk Management

Students are often asked to write an essay on Risk Management in their schools and colleges. And if you’re also looking for the same, we have created 100-word, 250-word, and 500-word essays on the topic.

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100 Words Essay on Risk Management

What is risk management.

Risk Management is the process of identifying, assessing, and controlling threats to an organization’s capital and earnings. These threats or risks could stem from a wide variety of sources, including financial uncertainty, legal liabilities, strategic management errors, accidents, and natural disasters.

Importance of Risk Management

Risk Management is important because it prepares an organization to face uncertainties. It helps to understand potential risks and to make plans to minimize their impact. Proper risk management can reduce not only the likelihood of an event occurring, but also the magnitude of its impact.

Steps in Risk Management

Risk Management involves several steps. The first step is identifying the risks. The next step is analyzing the risk to understand its potential impact. The third step is evaluating or ranking the risk. The final step is treating or controlling the risk.

Risk Management Techniques

There are several techniques for managing risk. One is risk avoidance, where the aim is to eliminate all risks. Another technique is risk reduction, where steps are taken to reduce the severity of the loss. Risk retention and risk transfer are other techniques used in risk management.

250 Words Essay on Risk Management

Risk Management is a process that helps identify, assess, and control threats that could harm an organization. These threats or risks could be anything from financial problems, accidents, natural disasters, or even legal issues. The main goal of Risk Management is to lessen the impact of these risks.

Risk Management follows four main steps. First, we identify the risks. This means we look at what could possibly go wrong. Next, we assess the risks. We try to figure out how likely it is that these risks will happen and how much damage they could cause. Then, we work on ways to control these risks. This could mean coming up with a plan to prevent the risk or lessen its impact. Finally, we monitor the risks. We keep an eye on them to see if they change or if new risks come up.

Risk Management is very important because it helps organizations prepare for the unexpected. It helps them make plans that can prevent or lessen damage from risks. It also helps them save money that they might lose if these risks were to happen.

In conclusion, Risk Management is a necessary practice for all organizations. It helps them identify, assess, control, and monitor risks. By doing this, organizations can prevent or lessen the impact of these risks, saving them from potential damage and loss.

500 Words Essay on Risk Management

Risk Management is a process that helps you identify and control possible problems that might happen in the future. It’s like a safety net that prepares you for any unexpected events.

Why is Risk Management Important?

Risk Management includes four main steps:

1. Identifying the Risks: The first step is to find out what could go wrong. This could be anything from a machine breaking down to a sudden change in market trends. 2. Analyzing the Risks: Next, you need to understand how big the problem could be. This helps to decide which risks need the most attention. 3. Planning the Response: Once you know the risks, you can make plans to handle them. This could mean avoiding the risk, reducing its impact, or accepting it and making a plan to recover from it. 4. Monitoring the Risks: Finally, you need to keep an eye on the risks and how well your plans are working. This means you can make changes if needed.

Benefits of Risk Management

Risk management in everyday life.

So, Risk Management is a very helpful tool. It prepares us for the future and helps to avoid or reduce problems. It is used in businesses, but also in our everyday lives. By understanding and using Risk Management, we can make better decisions and be ready for whatever comes our way.

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Risk Management - Free Essay Examples And Topic Ideas

Risk management involves identifying, assessing, and controlling threats to an organization’s capital and earnings. These threats could stem from a wide variety of sources, including financial uncertainty, legal liabilities, strategic management errors, accidents, and natural disasters. An essay on risk management might cover strategies to mitigate risks, the impact of risk management on business performance, and the evolution of risk management practices over time. This topic might also touch on various risk assessment models, the ethical aspects of risk management, and case studies illustrating the consequences of inadequate risk management. We have collected a large number of free essay examples about Risk Management you can find in Papersowl database. You can use our samples for inspiration to write your own essay, research paper, or just to explore a new topic for yourself.

Risk Management in Nursing Practice

Bowers (2014) identifies the need for the preservation of safety as the most crucial objective for mental health nursing. However, this is a very isolative environment with seclusion being a part of this treatment and intervention. Clifton et al (2017) argues that this could lead to possible deterioration of social inclusion, independence and communication. Shared decision-making (SDM) is a frequently utilized model for the purpose of approaching sensitive decisions (Stiggelbout et al, 2015). This process is where clinicians and patients […]

Risk Management of Innovation Projects

Abstract A company’s ability to create new products and services that differentiate them from the competition is becoming a key factor to ensure a business’ longevity in this ever-growing market. Because of this, organizations have continuously tried to launch innovation projects that ultimately fail in most cases due to the higher than normal levels of risk and uncertainty associated with these types of ventures. The purpose of this paper is to review and analyze the characteristics of radical innovation projects […]

Discuss the Importance of Data Management in Research

1. Definiton of Key terms Data management is a general term which refers to a part of research process involving organising, structuring, storage and care of data generated during the research process. It is of prime importance in that it is part of good research practice and it has a bearing on the quality of analysis and research output. The University of Edinburgh (2014) defines data management as a general term covering how you organize, structure, store and care for […]

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What is Risk Management?

A risk is any unverifiable event or condition that may influence our task(project). Not all dangers are negative. A few occasions or conditions can encourage our task. At the point when this occurs, we consider it a chance; however it's as yet dealt with simply like a hazard. A proactive task group attempts to determine potential issues previously they happen. This is the craft of hazard administration. The motivation behind hazard administration is to recognize the hazard factors for a […]

Effective Risk Management

Uncertainty bounds today's economy, and every organization needs a structured process for effective risk management to sustain a competitive edge (K. J., A., V. R., and U., 2017). Numerous corporate governance regulations, like the SOX Act 2002, COSO Enterprise Risk Management Framework 2004, Companies Act 2013, and Clause 49 of SEBI, have made the existence of a risk management committee mandatory. A risk management committee, a person, or a group of persons, is required at the top management level for […]

Citizen and Government Collaboration in Addressing Natural Disasters in Japan

Natural hazards are indeed inevitable, even during this time of pandemic. A massive 7.3 magnitude earthquake has jolted the northeastern coast of Japan, leaving 150 injured people last February 13, 2021. It’s considered an aftershock of the 2011 Great East Japan Earthquake because it happened just weeks before its 10th anniversary. The 7.3 magnitude earthquake caused widespread blackouts, affecting 950,000 households, and displaced around 240 people in Miyagi and Fukushima prefectures from their homes. The Japanese Intensity Scale logged it […]

Futuram’s Risk Management Strategy

Read the following story about this agricultural biotech firm carefully, then answer the questions at the end of the case. This story, all names, characters, and incidents described are fictitious. No identification with actual persons, companies, places, or products is intended or should be inferred. Normally, when Futuram is mentioned in newspapers, it's usually for a new genetically engineered seed. Yet this agricultural biotech firm, based in California, has turned to financial engineering to ensure its profits. At its January 2017 […]

IT Risk Management Techniques

Introduction In life, only two things are true about failure. One, it is common and second, nobody likes them. Failure is something that cannot be completely avoided but it is not absolute as well. Past failures become better lessons on which such failures doesn’t occur in the future. Modifications and changes made due to failures signal positive changes in the entity and scopes for improvement. The only irony in this case is that each failure comes at a certain cost. […]

Risk Policy, Management and Communication

I would like to thank the Municipal Administration and Water Supplies Department, State Government of Tamil Nadu, India for inviting me to speak about the current scenario and to give my recommendations for making P.N.Palayam a model town with regard to Sanitation. I am Priscilla, an Environmental Scientist, representing Bill and Melinda Gates Foundation, India. I have done my master’s in environmental science in 1996 and completed my Doctoral degree in Environmental Health at Johns Hopkins Bloomberg School of Public […]

Disaster Risk Management

"Disasters can happen to anyone at any time, but research says even the best disaster-recovery plans will not work exactly as envisioned (Drew & Tysiac, 2013). Huge amounts of destruction and suffering can lead to mental health and other issues for employees. This is why organizations should focus on their people's needs. Firms in the state of Florida and other natural disaster areas are well-advised to have business interruption insurance, which is structured to compensate businesses for time-frames when they […]

Effective Teamwork: Risk Management

Risk is the presence of uncertainty of results regarding present actions ( Shastri and Shastri, 2014 ). Risk arises due to occurrence of chance events, incubating and culminating in the changing dynamics of the environment. All functional areas of an organization are affected by risk. A single event can unleash a variety of risks. Risk is omnipresent, omnipotent and omniscient. Risk management is a process effected by the entity’s board of directors, management and other personnel, applied in strategy setting […]

Hazard Management in Foreign Exchange

Back Back is a term portraying the investigation and arrangement of cash, ventures, and other money related instruments. A few people want to isolate back into three unmistakable classifications: open fund, corporate fund, and individual fund. There is additionally the as of late rising region of social back. Conduct fund tries to distinguish the intellectual (e.g. enthusiastic, social, and mental) explanations for money related choices. Outside Exchange Outside trade is the transformation of one nation's money into another. In a […]

Impact of Natural Disasters on Risk Management

Research says threats of natural disasters may continue to rise due to the increase in the average temperature of the water in oceans (Tennyson & Diala, 2016). Weather events will be intense and frequent due to global warming. This will result in rising sea levels and other environmental changes. According to Tennyson and Diala, disaster preparedness is the total of all measures that have been taken and the policies that have been adopted to address a disaster before it occurs […]

Risk Management in Online Transactions

Abstract There has been a significant increase in the number of online transactions on various platforms. Online transactions are boosting the global economy by offering convenience and speed of the money transactions between merchants and customers. For online transactions to be successful, there is a need to have a reliable network that is enhanced by a security system to safeguard the information of the transactions. The networks used to secure online transactions are not entirely effective hence there is need […]

Risk Management in a Banking System

A risk is an essential part of our daily lives. Despite the complexity of this concept, we often and easily operate it in practice, describing a particular life situation. For us, a risk is primarily a possible profit or loss of something. Commercial activities, as well as any other activities related to the formulation and achievement of certain goals, include: situation analysis; strategy formulation; resource planning; organization of a process; measurement and evaluation of results; operational corrective strategic and tactical actions […]

Risk Management – Essential and Complete Corporate Governance System

Risk management is a known element of an essential and complete corporate governance system. It is defined as a mix of activities that effectively reduce the negative impact of risk exposure on the company's projected profits, cash flow, and consequently, the value of the organization. Effective risk management is regarded as an important factor that determines the survival and success of an organization. While risk management is not a new concept, it has recently garnered attention and become moreassertive in […]

Identifying and Managing Business Risks

Introduction A risk is a probability that something with an undesirable effect will occur. Risk management involves steps and policies taken by a company to eliminate these risks or reduce the possibility of their occurrence. A risk management plan is prepared to predict the risks, estimate their impact and severity, and suggest possible responses. Health Network allows clients to access the kind of healthcare services they require over the internet at the right locations. It faces several risks that can […]

The Effects Automation Technology has on Risk Management

Automation technology is the system of controlling a process by highly automatic means, resulting in reduced human intervention. This technology was created to relieve operators from continuous input. Automation benefits users by increasing safety, profitability, and productivity. By the use of machinery products are more predictable, consistent, and the cycle time of production is shorter than it would be if done by man. Though the idea of automatic technology seems fool proof there are disadvantages to it as well. Since […]

Risk Management Techniques for Satellite Programs

Successfully placing a satellite into space requires many elements of a very complicated process coming together, to allow for an on-schedule launch, and nominal operations of the system once on-orbit. Modern day government organizations and private sector companies have become adept at this process, as space launches occur with regularity all over the world. Despite the high success rates seen in the launch and operation of modern satellite systems, risk still pervades these programs, from writing requirements to the ready-for-launch' […]

Enterprise Risk Management Project

Coca-Cola Bottling Company Consolidated was formed 116 years ago in Greensboro North Carolina. Here they started to begin to produce and deliver an ironic brand there. It was all started by J.B. Harrison where he started selling the bottles. In 1955 they started to make 10,12, and 26 ounce family size and king sized bottles. In 1982 they first introduced the idea of Diet Coke. Also, in 2002 they celebrated their 100 year of business. Currently, the company's corporate offices […]

Assessment Credit Risk Management

Credit risk management practices is an issue of concern in financial institutions today and there is needto develop improved processes and systems to deliver better visibility into future performance. There have been controversies among researchers on the effect of credit management techniques adopted by various institutions. According to Saunders and Allen (2002), good selection strategy for risk monitoring is adopted by the credit unions implies good pricing of the products in line with the estimated risk which greatly affect their […]

Issue, Risk and Reputation Management

The proactive behavior, commonly associated with the initiative, creativity, and innovation, is required in today's organizations. It can be a positive differential in times of market turmoil and uncertainty. According to Coombs, the best way to prevent a crisis in an organization is to have a proactive management. Proactive behavior is an element of change and it impacts the company's performance. A proactive management seeks deliberately for changes and improvements, it anticipates the problems and chooses its own course to […]

Risk Management: Role in Security and Establishes the Importance of Assets Within a Company

According to the Principles of Information Security, "risk management is the process of identifying risk, assessing its relative magnitude, and taking steps to reduce it to an acceptable level." Risk management plays an important role in security and establishes the importance of assets within a company. Financial and economic decisions made by a company are heavily influenced by the way risk management is handled. There are many important aspects to risk management, such as: risk identification, risk assessment, and risk […]

Risk Management Section of your Company’s

Read the Risk Management section of your company's 10-K. Do not print the 10-K. In your own words, summarize the risk management strategy. Tie this into the Risk Factors that you wrote in Project 1. Netflix's risk management strategy includes the following: Retaining and expanding its customer base: Subscription fees are the major revenue source for Netflix. Its ability to produce and acquire quality content depends directly on retaining its current customers and attracting new ones. If Netflix cannot satisfy […]

Essay about Risk Management Techniques for Satellite Programs

Either way, this helps to burn down the consequence of only have a sole dedicated relay through redundancy. Another aspect a program manager should consider when assessing risk with ground relays points to the operations crews that run them. An example of a human error causing a space disaster is showcased in the 2009 collision of an Iridium Communications satellite and a defunct Russian communications satellite. With the Russian satellite out of commission, it rested on the Iridium satellite to maneuver […]

Risk Management and Insurance

As people, we are faced with the possibility of loss in our everyday lives. Be it a car accident, illness, Property loss, or even death. As early as the millennia B.C, modern profit insurance was demonstrated in a contract of a loan of trading capital to traveling merchants. The first insurance company formed in the United States was in Charleston, South Carolina during 1732. Later in 1752, Benjamin Franklin helped spread insurance by creating the Philadelphia Contributionship which ensured that […]

Facilities Management

Introduction In any big gathering, crowd control is essential. Sports facilities are protected through crowd control since, where there are many people gathered together there is a high chance for a danger to take place. Secondly, the crowd needs to be managed because when people are in a crowd they always take for granted that other people have the responsibility (Ammon & Unruh 2010). Thirdly, big gathering makes people assimilate changes at a lower phase since they make the process […]

Health Data Breach Response Plan: a Managed Care Organization’s Comprehensive Plan

Response plan on health data breach Introduction Security imperatives of preventing, responding to, and detecting breaches will finally end with good reason and appropriate rejoinder criteria implemented. Breaches in various companies have become inevitable despite efforts put in place to prevent their continuous occurrence. Once there is an unauthorized disclosure, compromise of protected data, or hacking of information that is protected, an organization is obliged to respond. Putting an effective response plan in place is not a small feat. Organization's […]

The Confluence of AAA4 Insurance and Virtual Reality Innovation

In today's fast-paced world, insurance remains a bedrock of financial security, shielding individuals from the uncertainties that life often throws our way. Among the plethora of insurance products, AAA4 insurance is notable for its specialized coverage options tailored to unique needs. When we merge the concept of AAA4 insurance with the burgeoning field of virtual reality (VR), an intriguing narrative unfolds, highlighting the transformative potential and unforeseen synergies between these two domains. AAA4 insurance is characterized by its bespoke coverage, […]

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• Risk Management Essays

Risk Management Essays (Examples)

Filter by keywords:(add comma between each), example essays.

Risk Management the Objective of This Study

Risk Management The objective of this study is to discuss the role and nature of organizational risk management in justice and security organizations and why it is so important. The following will be addressed in the assessment; (1) risk planning and resource identification; (2) management of risk in justice and security organizations; (3) costs associated in managing risk; (4) consequences of failing to manage risk; and benefits; and (5) benefits a properly performed risk analysis has for management and key stakeholders. Risk Management Risk management planning involves the consideration of a strategy for managing risk and responsibilities related to assessing, responding, and mitigating risk as well as contingency planning, tracking and reporting. Risk is reported to be defined as an event that is very likely to occur and that would either positively or negatively impact a project if and when that risk did occur. (National Disaster Medical System, nd, paraphrased) Managing risk involves…...

mla Bibliography Enhancing the Delivery of Justice and Security (2013) OECD. Retrieved from: http://www.oecd.org/development/incaf/38434642.pdf Reiss, CL (2013) Risk Mitigation and Planning (2013) Office of International Programs. U.S. Department of Transportation of Federal Highway Administration. Retrieved from:   http://international.fhwa.dot.gov/riskassess/risk_hcm06_05.cfm  Risk Analysis and Contingency Planning In the context of policy & decision-making (nd) EasyPol. FAO Policy Learning Program: Specific Policy Issues: Risk Analysis and Contingency Planning. Retrieved from:   http://www.fao.org/docs/up/easypol/788/risk_analysis_and_contingency_plan_slides_079en.pdf  Risk Management Plan (nd) National Disaster Management System. Retrieved from: http://www.phe.gov/about/amcg/toolkit/Documents/risk-management.pdf

Risk Management I Will Measure

3. The action levels will include all the levels of risk determination and mitigation involved. First, the process would have to be initiated by means of defining potential problems. A risk management team would be brought into being in order to determine the specific risks involved. The quality inspector will lead the team, and be responsible for obtaining data of aircraft using our part. In terms of the teams working on the manufacturing floor, I will appoint a personnel manager to ensure communication between employees and management. This communication process is to ensure that personnel have a way of communicate their problems regarding work load or other problems. Furthermore, personnel are also to report problems with manufacturing to the personnel manager. These are to be logged and communicated to the risk management team. The personnel manager and risk management team should then coordinate in the other steps of risk mitigation, including the…...

Risk Management Explain the Difference

The most effective security reporting procedure is to use the OCTAVE-based methodology. The reason why is because, they are utilizing solutions that will address the total nature of the threat in comparison with the others. For any kind of organization, this helps them to understand what kinds of issues that they could be facing and the impact that it will have on the entity itself. At the same time, it provides a workable formula that can be continually utilized through the various checklists and procedures that they have established. When you put these different elements together, they are illustrating how this kind of approach will help an organization to be able to effectively deal with a variety of threats. While allowing them to: effectively train personnel to understand the overall nature of what is taking place and how to quickly adjust to changes that are occurring. This is the point…...

mla Bibliography Quantitative Analysis. (2011). Dictionary.com. Retrieved from:   http://dictionary.reference.com/browse/quantitative+analysis  Landoll, D. (2006). The Security Risk Assessment Handbook. New York, NY: Taylor and Francis.

Risk Management Integrated Emergency Planning an Emergency

Risk Management Integrated Emergency Planning An Emergency Risk Management Plan for a Large Supermarket in the UK Emergency Planning in the UK Risk Identification and Qualification PESTEL Framework Risk Identification Table Risk Qualification Matrix Risk Quantification Disaster Management Plan Situation Mapping of Hazards, Vulnerabilities and Impact Vulnerability Table Loss Estimation Resource Inventory Communication Management Plan Monitoring Plan This emergency management plan has been created for a large independent supermarket chain in the UK. The supermarket is comprised of six locations in total and all of the facilities have petrol facilities at each of the locations as well. Besides the locations themselves, the retail operation is entirely dependent on a well-developed supply chain in order to provide consumers with fresh food, supplies, and petrol. Therefore to maintain any level of operations, the entire supply chain and emergency supplier alternatives must be considered as well in this emergency management plan. 1.1 Emergency Planning in the UK The UK represents a modern society with an economy that is heavily dependent on…...

mla Works Cited Eguchi, R. et al., 1997. Real-Time Loss Estimation as Emergency Response Decision Support System. Earthquake Spectra, 13(4), pp. 815-831. Wood, Z., 2008. Supermarkets' emergency plans to keep shelves full. [Online] Available at:   [Accessed 21 August 2012]. http://www.guardian.co.uk/business/2008/dec/14/retail-supermarkets-suppliers-credit-crunch 

Risk Management What Is Risk Please Respond

Risk Management What is Risk?" Please respond to the following: Risk concerns both positive and negative aspects of an event. Analyze why it is important to consider both perspectives when addressing risk for an organization. Include an example to support your response. It is important to consider the positive AND negative sides of any given possible outcome because one cannot properly plan for what is and what is not necessary given a certain event for which there is a risk. For example, a snowstorm might make the roads dangerous and thus make it hard for a brick and mortar store to function but the likelihood of customers driving in that same weather is also pretty low, so the overall loss is not as high as it could be if business was lost. However, Amazon (an online store) would not get that benefit…so that point of analysis is important to determine risks and how/when…...

Risk Management Project Management Is a Practical

isk Management Project management is a practical and academic field of growing importance as deadlines in the business world grow ever more rushed and profit margins grow ever slimmer. The need to maintain tight efficiency and cost control over all elements of a project is quite strong and growing stronger as competition in most industries grows more fierce, and this is exactly why project management is so increasingly useful. It is by establishing certain parameters and ensuring that they are adhered to throughout the different phases of a given project that effective project management enables controls over costs and timelines in a manner that increases profitability and minimizes risk exposure to the project's stakeholders. isk Management in Project Management In the context of project management, risk management refers to determining the potentials and uncertainties of all possible courses of action, quantifying these risks and their effects in some manner, monitoring the emergence and/or…...

mla References PMIS. (2001). Buffering against risk. Accessed 2 December 2010. http://www.focusedperformance.com/articles/bufrisk.html Project Perfect. (2000). Risk management basics. Accessed 2 December 2010.   http://www.projectperfect.com.au/info_risk_mgmt.php  Tusler, R. (1996). Project risk management. Accessed 2 December 2010.   http://www.netcomuk.co.uk/~rtusler/project/riskwhen.html  WNR. (2010). U.S. oil spill panel urges increased safety steps. World News Report. Accessed 2 December 2010.   http://www.einnews.com/unitedstates/newsfeed-united-states-risk-management

Risk Management Financial Derivatives Are an Innovation

isk Management Financial derivatives are an innovation in the field of finance that enable us to understand, measure and manage our financial risks. The definition of financial derivative according to the textbooks is of a financial instrument, and the value of any financial derivative is based on the value or values of the underlying securities or groups of securities that constitute the derivative. It can be said that there have been three main reasons for the continuously increasing use of derivatives now. These are the volatility of the markets, deregulation and development of technologies. There are also many shapes of financial derivatives, and options are just one form. As is clear from the name 'derivative', the items are just contracts based on or derived from some underlying asset, reference rate or index. The common types of financial derivatives are any one, or a combination of four separate types of dealings which…...

mla References Brief Guide to Financial Derivatives" Retrieved at   Accessed on August 7, 2004 http://www.psc.state.pa.us/capital/derivatives.html . Bacha, Obiyathullah Ismath (1998)"Derivative Instruments and Islamic Finance: Some Thoughts for a Reconsideration" International Journal of Islamic Financial Services; Volume: 1 Number.1, pp: 34-38 Comptroller's Handbook. (January, 1997) "Risk Management of Financial Derivatives" Financial Derivatives" (March 19, 1999) Remarks by Chairman Alan Greenspan before the Futures Industry Association, Boca Raton, Florida. Retrieved at   Accessed on August 7, 2004 http://www.federalreserve.gov/boarddocs/speeches/1999/19990319.htm .

Risk Management Improving Communication Amongst

(Smith, 2003) Checking twice, or more than twice may be less important than securing a diversity of views in such an arena. (Smith, 2003) The ability adequately communicate risk levels amongst providers can become difficult. Also, hasty words can create a misperception in the minds of patients, if a doctor speaks too casually. "Science cannot prove a negative, but, where their children are concerned, parents want to be assured that risk is zero," and it is tempting for doctors to ignore communicating data, for fear of communication the issue. Some suggest, regarding all procedures, establishing a comprehensive 'Richter scale' of risks to communicate data to remove the potential for misunderstanding -- for example, identifying the riskiest scenarios, and flagging them for hospital staff, or using the 'pain scale' amongst all hospital staff and on paperwork of 1-10 to communicate how much pain a patient is in, on a feeling level,…...

mla Works Cited Bellaby, Paul. (27 Sept 2003) "Communication and Miscommunication." British Medical Journal. 327:725-728. Retrieved on 22 Aug 2005 at   http://bmj.bmjjournals.com/cgi/content/full/bmj;327/7417/725  New York Presbyterian. (2005) "Mission Statement." Official Website Retrieved on 22 Aug 2005 at http://www.nyp.org/about/mission.html?name1=Leading+the+Way&type1=2Select&name2=Mission&type2=3Active Risk Management Worksheet." (2005) Official Website Retrieved on 22 Aug 2005 at   http://www.med.cornell.edu/research/pdf/contracts/mtarform-in.pdf  Robert Wood Johnson. (2005) "Patient Safety." Official Website Retrieved on 22 Aug 2005 at   http://www.rwjuh.edu/medserv/patientsafety.html

Risk Management in Consideration as a Vital Component of the Governance of Social Security Institutions

isk Management A Vital Component in the Governance of Health Care Institutions isk exists in any endeavor. Many people drive every day risking a traffic collision, others live in areas where the risk of spring tornados is extreme, and still other people work around high power electric lines. The question to ask is how can a person moderate the risks that they face each day? Make sure that the vehicle is performing to its optimal capabilities and that driving is undistracted and intentional. Make sure that a safe place exists nearby to go in the event of dangerous weather. Follow all of the safety regulations that go with the job of an electric company lineman. Basically people need to be alert and responsive to the situations that present themselves. Individuals must also understand that they have taken care of all but the most unforeseen eventualities (such as making sure the car one…...

mla References Adams, R.J. (2010). Improving health outcomes with better patient understanding and education. Risk Management and Healthcare Policy, 3. Ethics Point. (2010). Healthcare risk management takes a broader perspective. Retrieved February 23, 2011 from   ement.pdf http://www.ethicspoint.com/Upload/Articles/Whitepaper_Healthcare_Risk_Manag  Kuhn, A.M. & Youngberg, B.J. (2002). The need for risk management to evolve to assure a culture of safety. Quality Healthcare. 158-162. Miller, J. (2010). The definition of risk management in health care. Retrieved February 24, 2011 from management-health-care.html http://www.ehow.com/about_6619711_definition-risk-

Risk Management and Insurance

isk Management and Insurance What is isk Management and why is it important in Business Today? One must first define for oneself the meaning of risk, not only relative to his own life but to his business and financial future. In defining the types of risk, pure or speculative, one will then need to determine the level of risk and uncertainty one is willing to endure to achieve ones ultimate goal. After having answered these primary concerns and depending upon the type of business and style of management being practiced, the risk-taker might decide to create a risk management plan that best suites the business and personal limitations discovered. "The management of risk is a process distinct from its measurement. It involves a set of institutional rules that are largely dependent on (set of) goals." (Focardi & Jonas, pg. 95, 1998). In the management of risk one may also decide that a…...

mla References Bremen, M. (1998). Currency Risk Management for Firms and Financial Institutions. The Netherlands: Tilburg University Press. Brisbin, R.E. (1990). Loss Control for the Small to Medium Size Business: Reducing Workers' Compensations Costs. New York: Reinhold. Chapman, C. And Ward, S. (2002. Project Risk and Uncertainty: A Constructively Simple Approach to Decision Making. West Sussex: Joh Wiley & Sons.

Risk Management Cslo the Reason Why it

Risk Management CSLO The reason why it is important to understand the role of the financial markets is: because of globalization. As, this has caused shifts in: the economy and the way people are interacting with each other. One way to effectively comprehend what is taking place is with, the indices reflecting how these transformations are impacting the world economy. This means that ordinary people need to have an: understanding of the markets and the way they are reacting to various events. This will help them to determine, what will occur in the economy over the next nine months to one year. As, prudent individuals can begin to plan on: profiting from these changes or they could protect their assets. In either case, understanding the markets in this aspect will help everyone to more effectively prepare for uncertainties. This is how you can be able to increase your net worth and protect…...

mla Bibliography Binomial Option. (2011). Investopedia. Retrieved from:   http://www.investopedia.com/terms/b/binomialoptionpricing.asp  Put Call Parity. (1996). Risk Glossary. Retrieved from: http://www.riskglossary.com/link/put_call_parity.htm Larson, M. (2009). Big Money, Less Risk. Columbia, MD: Marketplace Books.

Risk Management Tools the

The SMAT-a solution is characterized by the following: The formal assessment of the risks through the employment of the ISO 27005 standards and the OCTAVE techniques The systematic assessment of the risk through the PDCA model (plan, do, check, act) The automated risk assessment through the Fast a feature, which "provides fully automated risk assessment with a built in database of standard assets, threats, vulnerabilities and controls" (Website of SMAT-A) The creation of detailed reports such as multi-criterion filtering or exports to other formats The monitoring of risks through the monitoring of risk mitigation controls and the identification of the new risks after mitigation (Website of SMAT-A). Last, the third potential solution to automating the IT risk assessment is represented by the Symantec isk Automation Suite (SAS), which is also a privately developed solution, characterized by more flexibility and ease of usage. "SAS automates and orchestrates enterprise IT security and risk management. SAS simplifies and integrates…...

mla References: Coderre, D., 2009, Internal audit: efficiency through automation, John Wiley and Sons Automated risk management using NIST standards, ACR 2 Solutions,   accessed on July 10, 2012 http://www.acr2solutions.com/Documents/Automating_Risk_Management.pdflast  Risk assessment, Website of SMART-RA, accessed on July 10, 2012 http://www.smart-ra.com/riskassessment.aspxlast Symantec Risk Automation Suite, Website of Symantec,   accessed on July 10, 2012 http://www.symantec.com/risk-automation-suitelast 

Risk Management the Six Major Processes Involved

Risk Management The six major processes involved in risk management are planning risk management, identifying risks, performing qualitative risk analysis, performing quantitative risk analysis, planning risk responses and actually controlling risk. One might argue that the two most important of these processes are the first and the last ones -- the planning of risk management and the controlling of risk once it actually occurs and becomes a threat to a particular enterprise. Nonetheless, planning risk management has a preeminence associated with it for the simple fact that in this initial step, the vast majority of the other steps are considered. During the planning stage, organizations are essentially determining what sorts of risks they are susceptible to and how, how great a risk these things are to the organization, and how they will respond and ultimately mitigate or control the risk. The best example of this step is an organization that has…...

Risk Management Diversified Worldwide Industries

Numerous products are available, including currency or exchange rate swaps, forward contracts, futures and options. Another option, which covers some of the translation risk as well, is to index costs and revenues to the exchange rate. Translation risk is more difficult to address, but there are methods. DI can build an operational hedge, whereby inflows from a particular country are matched by outflows. Other tactics, such as using an average exchange rate for the entire income statement or balance sheet, can mitigate the risk but not eliminate it. Economic risk is a significant form of risk because many of DI's industries are cyclical. This risk is less critical for DI because the company is well-diversified across many industries and countries. This is an operational hedge against the impacts of a faltering economy against any one of our businesses. However, some economic risk still remains. It can be hedged by establishing…...

mla Works Cited Moore, Howard L. (1999). "Hedging Political Risk" Global Finance. Retrieved November 21, 2008 at   http://findarticles.com/p/articles/mi_qa3715/is_199909/ai_n8870125  Francis, Rob. (2002). "Growing Natural Hedges" Frontier Economics. Retrieved November 21, 2008 at   http://www.frontier-economics.com/_library/publications/frontier%20bulletin%20-%20growing%20natural%20hedges.pdf  Gray, Philip & Irwin, Timothy. (2003) "Exchange Rate Risk" World Bank. Retrieved November 21, 2008 at http://rru.worldbank.org/Documents/PublicPolicyJournal/266Gray-121203.pdf

Risk Management Programs Comparison There Are'so

isk Management Programs Comparison There are so many potential risks in hospital and HMO settings because of the nature of healthcare. Hospitals have a ton of regulatory laws to follow that are passed by federal, state, and local legal agencies. HMOs are health management organizations, which are smaller groups that aim to provide healthcare and insurance options for individuals who subscribe to their services and thus have similar risk factors to general hospitals. Federal agencies like the Centers for Medicare and Medicaid Services (CMS), the FDA, the Office of Inspector General (OIG) and the Department of Justice are all involved with constantly updating hospitals and other healthcare organizations, like HMO facilities, of the need to stay on top of various risks. Agencies like the FDA establish laws, while the Department of Justice provide a list of healthcare professionals who have committed crimes, "announces penalties, fines, and Corporate Integrity Agreements imposed on…...

mla References Dinatale, Paola & Granger, Brad. (2010). Demysify risk management in nursing homes. McKnight's Long-term Care News. Web.   http://www.mcknights.com/demystify-risk-management-in-nursing-homes/article/164835/  Moran, Bill. (2008). Hospital risk management program: Ten risk categories for the four-step process. Strategic Management. Web. http://www.compliance.com/articles/hospital-regulatory-risk-management-ten-risk-categories-to-use-during-the-four-step-process/

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Project Risk Management Analytical Essay

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The ability to effectively prepare, prevent and manage key risks forms one of the most important concepts in project management. Understanding risks facilitates the ability of a management team to determine which risks are related and have greater implications to the whole project’s objectivity.

To effectively identify a project’s risks, it would be important to first ascertain possible uncertainties that may arise from the project choice such as influence, decision making and environmental impacts. Identifying risks in a housing project may be ranked on two major benchmarks. First, it would be the assessment of whether the risk will actually occur and second, the holistic impact that it would accrue to the whole project.

Project lifecycle is a term used with reference to the whole project execution. It describes a project from its beginning to completion. To begin with, the initiation phase determines a project’s feasibility and formally authorizes its kick off. Besides, it provides the necessary project description for the participants so as to enhance the flow of events during the project.

Planning provides the required definition for all the activities and also derives the necessary schedules that are to be followed during the project. To effectively manage all risks in a project, all parties and staff involved should be subjected to training on different risks, their mitigation and the need for addressing them as key problems.

In addition, monitoring is very critical as the project progresses to facilitate evaluation of whether the set targets are being met by the project implementers. Moreover, instantaneous analysis of possible considerations for improvement should be executed. As an extension of the monitoring process, further instantaneous assessment is critical in assessing possible emergent risks during the project. Finally, a risk management department or unit would help in coordinating the assessment of different risks in a project.

Introduction

The ability to effectively prepare, prevent and manage key risks forms one of the most important concepts in project management. To effectively manage risk, it is important to first identify possible uncertainties that may arise from the project choice (Toegel & Barsoux 2012, p. 58).

Understanding risks further facilitates the ability to critically understand the interconnected nature of the whole project as well as other uncertainties. This paper seeks to explore how risk may be managed effectively and who should be responsible for this task It uses housing project as an example to analyze the role of project managers in taking full control of their designs and decisions in order to reduce the levels of risk involved.

Identifying risks

Project management is the major determinant of organization’s ability to realize its objectives in different undertakings. Leavy (2010, p. 11) cites that understanding the risks involved provides necessary objectives for a project and generates the most effective models of achieving them.

To effectively identify a project’s risks, it would be important to first ascertain possible uncertainties that may arise from the project choice such as influence, decision making and environmental impacts. In identifying risks, Lucio and Giuliano (2010, p. 173) point out that it is imperative to analyze short and long-term objectives of a project.

In a housing project, a project manager should analyze the objectives of a project before examining possible implications on the resources to be involved for its completion. This is an effective project management approach aimed at curbing cost –related and economic effects risks.

Westerberg and Wincent (2008, p. 51) underscore the importance of identifying risks involved in a project. They highlight the role of project managers in the critical examination of budgetary provision. This is critical in establishing uncertainties on the funding of a project. Notably, this step should also incorporate professionalism and expected efficiencies.

Characterizing threats

Risk characterization facilitates the ability of a project management leadership to determine which risks are related and have greater implications to the whole project’s objectivity. Management theorists point out that it further facilitates the ability to critically understand the interconnected nature of the whole project as well as other risks (Shayne 2011, p. 85). As a result, their categorization would be based on the types of risks before subdividing them to further analysis through ranking.

Identifying risks in a housing project would be ranked on two major benchmarks. Dale (2012) points out that first; it would be the assessment of whether the risk will actually take place. Thereafter, the holistic impact that it would accrue to the whole project is examined.

As a result, ranking would include three levels. First level rank would be the high considerations with extreme risks such as timely finishing and involved costs. Then, the medium rank would include risks with slightly reduced implications such as the market conditions. The low rank would finally involve risks of much less concerns but still with a potential shifting to medium rank if not carefully addressed.

Findings from studies on projects and environmental impacts have pointed towards establishing a system where environmental impact risks are reduced (Sun & Wu 2011, p. 340). In a housing project, in order to facilitate effective realization of the project’s objectives, its risk matrix should address land environmental impact risks.

This should be considered due to the fact that the largest part of the housing would actually be located on land and therefore directly impacting on ecosystem. Addressing possible implications of the project to the environment would be critical in facilitating biodiversity conservation.

Project life cycle

Project lifecycle is a term used with reference to the whole project execution (Putkiranta 2012, p. 343). As a result, it describes a project from its beginning to completion. To begin with, the initiation phase determines the project feasibility and formally authorizes its kick off. Besides, it provides the necessary project description for the participants to enhance flow of events during the project. This phase usually begins earlier than the project kick off.

Then, planning provides the needed definition for all the activities and also derives the necessary schedules that are to be followed during the project. Of greater importance, as Sebestyén and Tóth (2014) point out is that it provides a management plan to be used during the project implementation phase.

The third phase, executing phase, is considered to be one of the most essential stages as it is an outcome of the previous two phases. It involves immediate execution of a project details according to a management plan. Notably, this phase provides the necessary basement for assessing the efficacy of the previous phase one and two.

According to project management scholars (Dale, 2012; Palmer, Dunford& Akin 2009, p. 234), the monitoring and controlling phase is used to monitor the application of all the project activities as well as the predetermined processes. Of greater importance in this stage is the ability to make necessary changes and implement them to enhance achievement of the objectives in a project.

Manzerolle and Smeltzer (2011, p. 330) indicate that this phase is very essential as it facilitates for alignment of the project with new development that can be used to promote achievements of the pre-established objectives. Finally, the closing phase provides the procedure for summing up the project through finalising and concluding the evaluation.

In most of the cases, Liker and Hoseus (2007, p. 232) argue that many projects’ last phase takes place as a major continuation to phase four. The ability to complete the lifecycle of a project effectively acts as a key item in pre-estimating the actual efficacy that will be achieved throughout the whole project.

Project decision making

Effective identification of key decisions in a project acts as a critical planning process in aiding robustness and reducing risks towards achieving a given objective. Piirainen and Lindqvist (2010) draw from the model of utility in decision making to indicate that identifying key decisions would follows a sequence where core activities are conducted before others. Agreeably, identifying key decision paths would be based on stages where activities would first be identified and analyzed as a factor of progression.

This is reflected in Suh et al. (2010, p. 215) perspective on risk management that key decision paths are critical in limiting risks. Such decisions would include mechanisms to address all the uncertainties such as market conditions, designing process and the owners’ organization. Options in this case would involve considerations facilitating timely finishing, increasing the management commitment and effecting the design for completion.

Cohen (2002, p. 53) uses contingency theory to advocates for careful planning in project management to limit loss. The theory calls for analytical outset in making key decisions for guiding a project. In view of the theory, project managers should be able to respond to internal and external forces through effective leadership practices.

This view concurs with the argument posed by Johnson (2002, p. 8) that though many project managers have their own pre-establishes standards in management; they should avoid rigidity by seeking a leadership that is flexible and accommodates new objectives and dynamic standards. This consideration is further echoed by Hopkins (2009, p. 28) who indicates that contingent change factors are especially very crucial in leadership practices.

The book “Crafting strategy that measures up” illustrates how active decisions can be reached by project managers. It points towards use of a decision tree. In it, Ahenkora and Peasah (2011, p. 278) point out that it is one of the best methods of providing cohesive structures that facilitate easier examination of options while facilitating the making of critical choices.

In risk management, the decision tree analysis would be effected in the whole project by considering all the possible alternatives and drawing out lines from the risks. Then, description of each solution and costing would be done to gauge its efficacy compared to others. Numbers involved in the tree analysis would include cost of the option, its probability, and expected efficiency.

Project tools for risk management

As indicated in the lifecycle description, different stages have varying tools that anchor their specific applications. Starting phase demands tools that that have the ability to factor the later processes application and therefore provide the correct platform for their precise fitting into the process. Project charter templates assist the managers to generate the project’s objectives, visions, and generating the possible deliverables at the end of the project (Putkiranta 2012, p. 343).

Business case template tool provides the manager with the correct platform for further evaluating the project to be undertaken, identify the alternatives that can be assimilated, their benefits and associated costs, and identifies the possible risks to be expected during the project.

In addition, the creative-pro office provides the manager with an effective alignment platform for factoring in time, duties to be completed, the team members, and provides a flexible system for enhancing adjustments. In this respect, a manager is able to prepare for a reconnaissance to assess the preparedness of the team to effect the project.

Organizing and planning phases are very critical stages in risk management as they dictate the ability of a project to be effectively implemented in the next phase. Martin, Oliver and Jacquelyn (2010, p.193) indicate that a project plan is used to identify the tasks for the phase, sum up all the efforts required for the phase, and establishing the necessary inter-dependencies. Resources and financial plan tools are employed to determine the required labour, responsibilities, and finances to effect the whole project.

Besides, a resource planning tool is also used to identifyequipment needs to facilitate the different applications during the project. Hertz (2012, p. 6) argues that the tools used during planning and organizing phase should be employed in a mastery mode to enhance later adjustments where needed for further objectivity.

Moreover, a communication plan as a tool is essential in effecting the necessary interlinks between the staff participating in the project, their immediate leaders, and their head offices to enhance cohesion (Winer 2009, p. 108).

As indicated earlier, the execution phase forms the main part of the project and indeed demands more care as it entails direct involvement with the clients and customers. It also forms the basis for assessment and monitoring of a project. Project time management tool is used to enhance a systematic flow of events as established in the management plan (Scott & Krempley 2012, p.18).

Besides, the cost management ensures that the role of all the expenses is maintained within the budget to control the overheads. Change management as a tool is very critical in this phase as it dictates the ability of the project to be adjusted to reflect the immediate requirements of the clients (Putkiranta 2012, p. 343).

Attiany (2014) argues that a project closure forms a major facet as it dictates the efficacy of its application. Whereas many project managers appear to be reluctant by putting less emphasis on the last phase of a project, researchers point out that it is only through effective completion of all the stages that an organization can maintain the necessary budgets, allocate the correct time and predict the demands for the next project with precision.

Procedure closure report assists a project manager to identify the correct criteria for ending the project and plans the necessary handover of periodic reports for documentation (Putkiranta 2012, p. 343). This acts as a major point for linking the project’s outcome with the achieved results.

Besides, it closes the contracts with the suppliers and established agreements to pave way for further assessment. Finally, the post implementation review is used to measure the benefits assimilated from the project in comparison with set goals. Of greater essence this tool assist to generate lessons learnt to enhance future improvements.

Risk management plan

The article “ Scenario planning: navigating through today’s uncertain world ” by Axson (2011, p. 10) indicates that a project management plan should contain adequate and effective information that can facilitate reduction of risks and anchor achievement of its main objective. To begin with, risk identification information would facilitate easier categorization and ranking.

Besides, quantification of this information would help in further understanding of the impacts extent, severity, probability and response categories. The risk response on the other hand would contain information on possibilities of avoiding the risk, mitigating it or possible means of minimization to make the whole objective realizable. Finally the risk management plan should have an effective control strategy where monitoring and constant reviews are strictly adhered to at all stages of the project execution.

To effectively manage all risks for a project, the following tools and techniques should be employed effectively employed. To begin with, all parties and staff involved should be subjected to training on the different risks, their mitigation and the need for addressing them as key problems.

Training would be very critical in that it would facilitate clearer understanding of risks to all the involved stakeholders. In addition, monitoring would be very critical as the project progresses to facilitate evaluation of whether set targets are being met by the project implementers (Mahaney & Lederer 2011, p. 107).

In addition to that, instantaneous analysis of possible considerations for improvement should also be effected. As an extension of monitoring process, further instantaneous assessment would be critical in assessing possible emergent risks during the project. Finally, a risk management department or unit would help in coordinating the assessment of different risks in the project.

Risk monitoring and control process a housing project would be expected to provide an effective plan on mechanisms of addressing different risks. This according to Janicijevic (2010, p. 103) will be very critical as it would serve as the main guideline for the whole project.

Besides, it will create a platform for key assessments and possible reduction strategies for risks identified for the project. Besides, the process will be expected to meet the set standards of risks reduction and therefore making the key objective of meeting the opening deadline and possible.

Besides, the process will further be expected to operate within the established budgetary allocation in minimizing or addressing all the risks in the project. Finally, this process will be expected to effectively monitor, update, and inform all the stakeholders on the progress during execution.

Managing risks, planning and communication

To effectively meet objectives of a project, Johnson (2002, p. 8) indicates that a risk management plan must be developed. This should include a clear description of the project. Besides, it should include an effective risk identification strategy that covers all areas of project implementation.

Project management analysts argue that an effective project management risk plan should constitute a holistic analysis that would establish its occurrence probability (Scott & Krempley 2012, p. 19). In addition to that, mitigation or a reduction strategy should be incorporated with a final outline for monitoring and control. This according to Gomes and Yasin (2011, p.550) would help mitigate the risks by early identification, effective technological application, and follow-up to facilitate articulation of the established strategies.

Key stakeholders’ contribution to risk management decisions making is very critical to facilitate holistic acceptance of the management alternative decisions assimilated (Cohen 2002, p. 54; Valentine, 2012, p. 47). Therefore, contributions of the stakeholders in management decision making where the risks and their implications would be revealed for deliberations decisions to be reached at is important.

This method as (Waters 2007, p. 1123) points out is considered to be significant in that various contributions would be agreed upon through effective analysis of alternatives aimed at achieving the objective of the project. In addition to that, the media would also be used to relay key results to the public as stakeholders and opinions collected on their viewpoints.

Risk schedule analysis

Risk based schedule according to Hopkins (2009, p. 29) seeks to facilitate effective achievement of already established objectives in risk management. Factors related to time provided for by the project would be a very critical factor in establishing a realistic time frame. By considering the available time, Shayne (2010, p. 94) adds that risk management would be seen as a factor of the project as opposed to an external entity.

Besides, the schedule should also factor the consideration of the available resources for the project. At this point, Markle (2011, p. 290) observer that cost-effectiveness of all the established risk reduction and prevention consideration should be intrinsically considered.

In addition to that, the risk prevention executing personnel and their qualifications should also be considered because they would be the key implementing officers in the project. Finally, existing legislations related to the project for a host country should also be factored to reduce any possible conflict with the established mechanisms to mitigate their effects (Bielski 2005, p. 54).

Given the key description and risks identified in housing project, sensitivity analysis would consider the following key factors. To begin with, the destined time for completion and the opening of the project for use according to the pre-established objectives. This would be very sensitive in that completion within the established time would mean no extra budgetary costs while creating the expected economic opportunities (Scott & Krempley 2012, p.18).

In addition to that, the technology to be employed during the project would further be very crucial establishing the possible time to be taken and all the mechanisms for reducing the risks. Furthermore, the weather during the period of project execution would further be every important in developing the core strategies for onsite operations on.

Notably, with the project region of execution being subject to varied weather conditions, this consideration would facilitate the best selection of machines and equipment that suit the weather. In addition to that, the environment would be a key sensitivity factor to avoid obstructing animals’, human or vehicle movements during and after construction.

Conclusions

The ability to effectively prepare, prevent and manage key risks forms one of the most important concepts in promoting higher levels of productivity. Risks management must be articulated with great care and precision if pre-established objectives are to be achieved. A project manager’s role therefore includes developing a risk management plan. This must be articulated from a holistic point of view with effective involvement and communication with stakeholders at all levels.

This creates the needed cooperation and support.. At all stages, monitoring and evaluation must be executed to facilitate improvement of risk mitigation and identifying possible new ones. In the risk management plan, an executing teams’ mandate should be to ensure that all the involved people are trained on risks mitigation and identification.

This will in turn ensure effective identification of possible risks for the project. In addition, execution of the project will be effected instantaneously while analyzing the effects from the previous risks. This has been emphasized as a strategy to create a threshold for improvements.

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Home — Essay Samples — Business — Risk Management — The Importance of Risk Management

The Importance of Risk Management

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Published: Sep 1, 2023

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Risk Management Essays

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This is a topic that springs up often and many people don’t fully understand how it works. So start by taking a closer look at what risk management is and its start. It was most commonly used by companiess as a means to decide whether or not to continue in a certain direction.

With any type of new launch of a product or service line, there’s always an element of risk. Risk can directly equate to revenue loss, hence the reason corporations spend so much effort on mitigating it. It’s a trap no company wants to find themselves stuck in.

There’s also a process to follow and understand when it comes to risk management, from identifying and assessing the risk and building out action plans that later need to be implemented. Also, extensive monitoring is done in risk management just to ensure that everything appears as it is.

How do you write essays on risk management?

Risk management has evolved to be included in any corporate and business activity. Still, it can also be applied to our personal lives in some capacity. You can go a traditional route and discuss business activities in particular insurance industries that rely heavily on risk management.

You can also do a comparison of the effectiveness of risk management in various situations and see if it’s just a buzzword for many or if it is actually as effective as it claims to be.

Whatever way you go you need to make sure that there are a lot of metrics included in your essay as risk management is a heavily data-driven division in businesses. This data is hard to dispute in many cases so when you choose not to utilize it it can take away your essay’s credibility. Therefore an element that can’t be ignored.

Some excellent topics to discuss are the following:

• The role of risk management within project management • The relevance of risk management in financial planning • The use of risk management in insurance • The application of risk management in healthcare • The challenges of risk management in the digital age

If you still don’t know how to start, essay examples on this page may help you set your thoughts and start writing.

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Risk Management - Free Essay Examples and Topic Ideas

Risk management is a process of identifying, assessing, and prioritizing potential risks that can impact an organization’s operations, assets, or financial performance. Effective risk management involves implementing strategies to mitigate or transfer the identified risks while also preparing for and responding to unexpected events or crises. It is an essential function in any business or organization as it helps to minimize losses, protect assets, and ensure business continuity. Successful risk management practices require a thorough understanding of the organization’s objectives, potential vulnerabilities, and available resources.

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What Is Risk Management & Why Is It Important?

• 24 Oct 2023

Businesses can’t operate without risk. Economic, technological, environmental, and competitive factors introduce obstacles that companies must not only manage but overcome.

According to PwC’s Global Risk Survey , organizations that embrace strategic risk management are five times more likely to deliver stakeholder confidence and better business outcomes and two times more likely to expect faster revenue growth.

If you want to enhance your job performance and identify and mitigate risk more effectively, here’s a breakdown of what risk management is and why it’s important.

Access your free e-book today.

What Is Risk Management?

Risk management is the systematic process of identifying, assessing, and mitigating threats or uncertainties that can affect your organization. It involves analyzing risks’ likelihood and impact, developing strategies to minimize harm, and monitoring measures’ effectiveness.

“Competing successfully in any industry involves some level of risk,” says Harvard Business School Professor Robert Simons, who teaches the online course Strategy Execution . “But high-performing businesses with high-pressure cultures are especially vulnerable. As a manager, you need to know how and why these risks arise and how to avoid them.”

According to Strategy Execution , strategic risk has three main causes:

• Pressures due to growth: This is often caused by an accelerated rate of expansion that makes staffing or industry knowledge gaps more harmful to your business.
• Pressures due to culture: While entrepreneurial risk-taking can come with rewards, executive resistance and internal competition can cause problems.
• Pressures due to information management: Since information is key to effective leadership , gaps in performance measures can result in decentralized decision-making.

These pressures can lead to several types of risk that you must manage or mitigate to avoid reputational, financial, or strategic failures. However, risks aren’t always obvious.

“I think one of the challenges firms face is the ability to properly identify their risks,” says HBS Professor Eugene Soltes in Strategy Execution .

Therefore, it’s crucial to pinpoint unexpected events or conditions that could significantly impede your organization’s business strategy .

Related: Business Strategy vs. Strategy Execution: Which Course Is Right for Me?

According to Strategy Execution , strategic risk comprises:

• Operations risk: This occurs when internal operational errors interrupt your products or services’ flow. For example, shipping tainted products can negatively affect food distribution companies.
• Asset impairment risk: When your company’s assets lose a significant portion of their current value because of a decreased likelihood of receiving future cash flows . For instance, losing property assets, like a manufacturing plant, due to a natural disaster.
• Competitive risk: Changes in the competitive environment can interrupt your organization’s ability to create value and differentiate its offerings—eventually leading to a significant loss in revenue.
• Franchise risk: When your organization’s value erodes because stakeholders lose confidence in its objectives. This primarily results from failing to control any of the strategic risk sources listed above.

Understanding these risks is essential to ensuring your organization’s long-term success. Here’s a deeper dive into why risk management is important.

4 Reasons Why Risk Management Is Important

1. protects organization’s reputation.

In many cases, effective risk management proactively protects your organization from incidents that can affect its reputation.

“Franchise risk is a concern for all businesses,“ Simons says in Strategy Execution . “However, it's especially pressing for businesses whose reputations depend on the trust of key constituents.”

For example, airlines are particularly susceptible to franchise risk because of unforeseen events, such as flight delays and cancellations caused by weather or mechanical failure. While such incidents are considered operational risks, they can be incredibly damaging.

In 2016, Delta Airlines experienced a national computer outage, resulting in over 2,000 flight cancellations. Delta not only lost an estimated $150 million but took a hit to its reputation as a reliable airline that prided itself on “canceling cancellations.”

While Delta bounced back, the incident illustrates how mitigating operational errors can make or break your organization.

2. Minimizes Losses

Most businesses create risk management teams to avoid major financial losses. Yet, various risks can still impact their bottom lines.

A Vault Platform study found that dealing with workplace misconduct cost U.S. businesses over $20 billion in 2021. In addition, Soltes says in Strategy Execution that corporate fines for misconduct have risen 40-fold in the U.S. over the last 20 years.

One way to mitigate financial losses related to employee misconduct is by implementing internal controls. According to Strategy Execution , internal controls are the policies and procedures designed to ensure reliable accounting information and safeguard company assets.

“Managers use internal controls to limit the opportunities employees have to expose the business to risk,” Simons says in the course.

One company that could have benefited from implementing internal controls is Volkswagen (VW). In 2015, VW whistle-blowers revealed that the company’s engineers deliberately manipulated diesel vehicles’ emissions data to make them appear more environmentally friendly.

This led to severe consequences, including regulatory penalties, expensive vehicle recalls, and legal settlements—all of which resulted in significant financial losses. By 2018, U.S. authorities had extracted $25 billion in fines, penalties, civil damages, and restitution from the company.

Had VW maintained more rigorous internal controls to ensure transparency, compliance, and proper oversight of its engineering practices, perhaps it could have detected—or even averted—the situation.

Related: What Are Business Ethics & Why Are They Important?

3. Encourages Innovation and Growth

Risk management isn’t just about avoiding negative outcomes. It can also be the catalyst that drives your organization’s innovation and growth.

“Risks may not be pleasant to think about, but they’re inevitable if you want to push your business to innovate and remain competitive,” Simons says in Strategy Execution .

According to PwC , 83 percent of companies’ business strategies focus on growth, despite risks and mixed economic signals. In Strategy Execution , Simons notes that competitive risk is a challenge you must constantly monitor and address.

“Any firm operating in a competitive market must focus its attention on changes in the external environment that could impair its ability to create value for its customers,” Simons says.

This requires incorporating boundary systems —explicit statements that define and communicate risks to avoid—to ensure internal controls don’t extinguish innovation.

“Boundary systems are essential levers in businesses to give people freedom,” Simons says. “In such circumstances, you don’t want to stifle innovation or entrepreneurial behavior by telling people how to do their jobs. And if you want to remain competitive, you’ll need to innovate and adapt.”

Netflix is an example of how risk management can inspire innovation. In the early 2000s, the company was primarily known for its DVD-by-mail rental service. With growing competition from video rental stores, Netflix went against the grain and introduced its streaming service. This changed the market, resulting in a booming industry nearly a decade later.

Netflix’s innovation didn’t stop there. Once the steaming services market became highly competitive, the company shifted once again to gain a competitive edge. It ventured into producing original content, which ultimately helped differentiate its platform and attract additional subscribers.

By offering more freedom within internal controls, you can encourage innovation and constant growth.

4. Enhances Decision-Making

Risk management also provides a structured framework for decision-making. This can be beneficial if your business is inclined toward risks that are difficult to manage.

By pulling data from existing control systems to develop hypothetical scenarios, you can discuss and debate strategies’ efficacy before executing them.

“Interactive control systems are the formal information systems managers use to personally involve themselves in the decision activities of subordinates,” Simons says in Strategy Execution . “Decision activities that relate to and impact strategic uncertainties.”

JPMorgan Chase, one of the most prominent financial institutions in the world, is particularly susceptible to cyber risks because it compiles vast amounts of sensitive customer data . According to PwC , cybersecurity is the number one business risk on managers’ minds, with 78 percent worried about more frequent or broader cyber attacks.

Using data science techniques like machine learning algorithms enables JPMorgan Chase’s leadership not only to detect and prevent cyber attacks but address and mitigate risk.

Start Managing Your Organization's Risk

Risk management is essential to business. While some risk is inevitable, your ability to identify and mitigate it can benefit your organization.

But you can’t plan for everything. According to the Harvard Business Review , some risks are so remote that no one could have imagined them. Some result from a perfect storm of incidents, while others materialize rapidly and on enormous scales.

By taking an online strategy course , you can build the knowledge and skills to identify strategic risks and ensure they don’t undermine your business. For example, through an interactive learning experience, Strategy Execution enables you to draw insights from real-world business examples and better understand how to approach risk management.

Do you want to mitigate your organization’s risks? Explore Strategy Execution —one of our online strategy courses —and download our free strategy e-book to gain the insights to build a successful strategy.

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