Risk Management

• risk management is used to analyze the probability of an event taking place rather than minimizing negative impacts and also to capitalize possibilities
• they are seen as:

  R as uncertain

  R as threat

  R as opportunity
• the uncertainty is all linked to the:

  economy of country

  change in consumer demand

  political developments

  technological advances

  changes in legislation
• the risk management is implemented to ensure that business operations and strategic plans are alligned
• the objective of the risk management is to ensure that the business has a balance between threats and opportunities
• strategic planning refers to the vision, mission, goals, and value of the business which are part of the business
• risk profiling refers to the degree to which the business is willing to take risks and pursuit creating values
• risk culture is part of the business culture that is described as shared attitudes in a business
• types of risks:

  1. operational risks: usually deal with internal operations of business
  2. environmental risks: can be physical or business environmental
  3. Financial Risks: are dealt with financial operations
  4. Reputational risks: damaging the business reputation
  5. strategic risks: deals with the overall strategy of a business.
• risk assessment which involves identification is important to ensure that all activities are identified and allow risks to flow.

  1. Risk Workshop: management that is internal and external
  2. stakeholder: third party that is seen and leads to risk factor
  3. auditing: internal and external and finds possible risks
  4. benchmarking: someone who sets certain practices and looks at the best practice
  5. surveys: are used to find risks by asking questions
  6. scenario planning: uses what if to see the outcomes