Risk management (2)

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Risk management (2)

what is risk?

can be seen as a threat /opportunity/uncertainty

Types of risk

Supply Chain

Environmental

Reputational

Strategic

operational

Financial

Country

Risk Culture

risk culture in a business can reward risk-taking or risk avoiding behaviour

shared attitudes & practices in the business (the collective attitude towards accepting risk)

Risk profile

it is directly related to the strategy of a business (LONG TERM GOALS)

Refers to the degree that a business is willing to accept risks to achieve value or business goals

Objective:

ensure smooth business operations protecting business from potential disruptions

have balance between maximizing business operations & mitigating potential threats

Risk perception

Is how individuals interpret & evaluate potential risks

It influences how people view and respond to uncertainties

based :

cultural factors

emotions

experiences

Risk management process

4. Risk Reporting

stakeholders

external

internal

3. Risk response

Risk Acceptance

Risk Reduction

Risk Avoidance

2.Risk management policy

draft document/writing

communicate to parties

implement strategies

1.Risk Assessment

Estimation of risk impact

estimation tools

decision trees

Estimation matrix

probability vs impact

PROS/CONS CHART

SWOT

PESTLE

Description of risks

Identifiaction of risks

scenario planning

surveys

benchmarking

risk workshops

Auditing

ENVIRONMENTAL SCANNING ANAYLSIS

MICRO/MARKET/MACRO

strategic risk management

aligns decisions with organisation's mission/vision

integrates risk analysis in strategic planning

focuses on any risks affecting the long term goals of a business

considers

regulatory changes

market changes

competition

definition

Analysing the probability of an event taking place ,pro-active planning to minimize the negative impact on a business