Understanding Risk Management
A successful risk management program helps an organisation consider the full range of risks it faces by examining the relationship between risks and the impact they could have on an organisation’s strategic goals.
This holistic approach to managing risk is sometimes described as enterprise risk management because of its emphasis on anticipating and understanding risk across an organisation. In addition to a focus on internal and external threats, enterprise risk management (ERM) emphasises the importance of managing positive risk.
OUR APPROACH
Positive risks are opportunities that could increase business value or, conversely, damage an organization if not taken. Indeed, the aim of any risk management program is not to eliminate all risk but to preserve and add to enterprise value by making smart risk decisions.
“We don’t manage risks so we can have no risk, We manage risks in order to know which risks are worth taking, which ones will get us to our goal, which ones have enough of a payout to even take them, these calculated risks allows you to understand the risk versus the rewards.
Every organization faces the risk of unexpected, harmful events that can cost it money or cause it to close.
Risk management best practices
A creative risk management program should be intertwined with organisational strategy. To link them, risk management leaders must first define the organisation’s risk appetite — i.e., the amount of risk it is willing to accept to realise its objectives.
Create value for the organization
Be an integral part of the overall organizational process
Factor into the company's overall decision-making process
Explicitly address any uncertainty
Adopt a systematic and structured
Be tailored to the project
Transparent and all-inclusive
take into account human factors, including potential errors
be adaptable to change
be continuously monitored and improved upon.
Act on the best available information
Let Us Help You Take Your Business To New Technological Heights
Another best practice for the modern enterprise risk management program is to “digitally reform,” This entails using AI and other advanced technologies to automate inefficient and ineffective manual processes.