Risk
Management Basis
Risk Management is the
basic approach of the Integrated Management Systems
organisation.
All businesses face risks every day. These risks can
be managed and turned into opportunities or they could be
a real threat to your business's success. Risk management
is the practice of using processes, methods and tools for
managing these risks. Risk is defined as the probability
of an event and its consequences. For a business, this
could be anything from litigation by an employee over
safe working conditions, over-reliance on a single
customer to failure in the marketplace due to poor
quality. Risk management is clearly related to quality management, so you can increase your
business' chances of success by having effective risk and
quality management systems in place.
Identifying risks before they occur allows you to avoid
the problem altogether, or be prepared for the event with
cost efficient solutions, rather than hurriedly trying to
solve the problem after it arises.
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The Risk Management
process involves:-
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Identifying these risks.
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Assess likelihood, severity and risk rating of an event.
<> Identifying which events would cause the worst
problems and deal with them first.
<> Understanding how to prevent these events.
<> Understanding how to respond to events if they
do occur.
<> Monitoring the effectiveness of your risk
management approaches and controls.
However
before risk assessment it is essential to ask the
following questions.
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What is the purpose of the
business?
<> How does the business actually work? |
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