Credit Rating Terminology
Credit rating is an important and almost central part of the overall credit risk management function in any organization. Every major organization around the world has implemented credit rating in some form. In many companies, credit rating has been overtaken by credit scoring. Instead of providing a rough range about the creditworthiness of a prospective […]
Misdemeanours by Senior Leaders Must Be Handled Firmly and the Right Message Sent
Why Senior Leaders are Expected to be above Reproach and Role Models for Others Senior Leaders are supposed to be role models for the rest of the organization to follow and emulate. Moreover, they are the ones who articulate the organizational vision and actualize the mission for the Middle and Lower level employees and hence, […]
Recruiting a Diverse Team
The previous articles in this module discussed how diversity as a core value is important for organizations. We have also discussed how actualizing diversity means that the entire organization has to walk the talk instead of merely espousing it in name and then practicing something different altogether. One of the most important actions that any […]
Surviving the Corporate Jungle and Winning the Power Game
Why the Corporate Journey is like a Game of Snakes and Ladders All organisations, big or small, have power centres and interests with differing agendas. In addition, especially in large firms, there are multiple power centres and senior executives with agendas of their own who jockey for the available resources and promotions to them and […]
Role of Team Leader in Team Building
A single brain sometimes cannot take decisions alone. One needs the assistance and guidance of others as well to accomplish the tasks within the desired time frame. In a team, every member contributes to his level best to achieve the assigned targets. The team members must be compatible with each other to avoid unnecessary conflicts […]
What does risk management mean? Is it just identification, assessment and planning and controlling social, economic or physical threat to the organization? Is the concept only about transferring the risk or reduce its negative effects?
Well, the answers for the above questions is “no”. The process of risk management is not only restricted to controlling the threats or reducing their negative effects. It is a much deeper concept that also involves risk avoiding as well as risk taking. Every work involves some or other kinds of risk. Sometimes you avoid, sometimes you control the phenomenon and sometimes you simply let it come. Same is true for the business world.
The idea behind is that there are no hard and fast rules. This means that even though we have a systematic approach to treat risk it is not necessary that this is going to help.
Simply designing and implementing a risk management plan is not enough to treat risk. It depends on firm-to-firm and industry-to-industry. There are various other criteria that need to be analyzed such as internal and external environment of a company, company’s ability to develop and implement a risk management plan effectively.
There are various other issues that need to be addressed. Before you spend your time, efforts and money, see if you really require a full-fledged risk management plan to control the financial, physical or social threat to the organization. Deeply examine your requirements and need to treat the risk. Sometimes, avoiding risk is considered as the best strategy.
When you decide about a risk management plan, you need to examine thoroughly and ask yourself few questions before proceeding further. These questions act as an eye opener and provide you with the outline of what you need to do and what to look at. Read further to know what you should ask yourself while designing, developing, implementing or reviewing your risk management plan:
The golden rule for the success rule of a risk management plan is that there is no golden rule. Each firm is different and faces different types of risks in different business environments. You need to develop a unique plan for your firm to manage the risks efficiently and effectively.
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