Why do you need Risk Management Solutions

Why do you need Risk Management Solutions

Life is a series of calculated risks – nothing more. Whether it’s catching the running train to work, crossing a busy road, investing in stock market, or making dietary choices, life is full of risks that you can’t get rid of, but can definetely mitigate.

Risk management is the identification, analysis, and response to an organization’s capital and earnings. It includes the proactive management of controlling possible future outcomes and reducing both the possibility and reoccurance of potential impacts.

Organizational risks and threats can be caused from a wide variety of sources like financial instability, legal obligations, management errors, accidents or even natural disasters. The objective of effective risk management is to increase the probability and/or impact of positive risks and decrease the impact of negative risk, in order to optimize the chances of goal accomplishment.

Risk management processes aims to identify and manage risks that are not addressed by other methods. When unmanaged, these risks have the potential to cause the organization to deviate from the goals and may lead to failure. Consequently, an effective risk management is directly related to the company success.

STEPS INVOLVED IN RISK MANAGEMENT

Risk management steps involves various methods than can be performed more or less in the following order-

  1. Identify the threats
  2. Assess the vulnerability of critical assets to specific threats
  3. Determine the risk (i.e. the expected likelihood and consequences of specific types of attacks on specific assets)
  4. Identify ways to reduce those risks
  5. Prioritize risk reduction measures

RISK MANAGEMENT STRUCTURE

  1. Risk Avoidance- This involves not performing an activity that could lead to a risk.
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  3. Risk Reduction- Risk reduction consists of diminishing the severity of the loss by implementing measures that may reduce the potential losses.
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  5. Risk Sharing-  Risk transfering or sharing involves passing the risk to a third party. This doesn’t change or eliminate the risk, instead it gives another party the responsibility to manage the risk.
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  7. Risk Retention- Risk retention involves accepting the loss, or benefit of gain, from a risk when any organicational incident occurs.

The strategy of risk mitigation dependents on the tolerance level that a company has already defined for itself. If a business sets up risk management as a disciplined and continuous process for the purpose of identifying and resolving risks, then the risk management structures can be used to support other risk mitigation systems.

WHY DO YOU NEED RISK MANAGEMENT SOLUTION?

By implementing a risk management strategy and analyzing the various potential risks, the organisation can save a lot of money and its future. The robust risk management plan can help the company establish its procedure to avoid threats, minimise their impact and cope with the results. The following are the reasons why risk management system is essential for any business.

  1. Support new decisions- Companies seek new project opportunities, but often fail to analyse the risks associated with it. Risk management solutions encourages business to take calculated decision while keeping in mind the risks involved.
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  3. Handle risks- Risk management techniques assist companies to increase its risk-taking capability. With the help of this, it becomes possible for the companies to identify and analyse risks efficiently and adequately.
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  5. Controls opportunity and its outcome- Through proper risk management implementation, companies can directly control the opportunity and risks associated with the new project. However, it entirely depends upon the obstacles that are faced by the company.
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  7. Prepare in advance- Risk management system is vital for the endurance and vitality of the company. This system prepares the company in advance by identifying the potential risk and assists in addressing it by developing various sources and techniques.
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  9. Provides Security- Risk Management system creates a safe and secure work environment for all staff and customers. It increases the stability of business operations by decreasing the legal liabilities and by providing protection from the detrimental events.
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  • Risk Retention- Risk retention involves accepting the loss, or benefit of gain, from a risk when any organicational incident occurs.

Our team at Suraksha Is involved in a wide spectrum of value-added services for corporate customers across India. Our risk management division works on cases that involve commercial and industrial risks. Feel free to contact us to avail any of our services.

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CIN- U67190WB2003PTC095855, IRDA LICENSE NO - 177