Risk Management

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Risk management is a way to find, analyze, and then prioritize risks or hazards that may be associated with an organization. The purpose of Hazard Analysis and/or Risk Management is to be proactive rather than reactive in controlling potential problems that may occur both fiscal, environmental, and human. In almost every organization there are some types of hazards and risks: safety issues, supplier issues, weather issues, legal or credit issues, disasters, completive attacks, etc. Risks and hazards are so common that standards have been set to identify, and hopefully help mitigate, potential issues (See Figure 1) (International Organization for Standardization, 2009). Basic risk management has at least six separate parts that help the organization: 1) Identification of risks or hazards within the particularly organization; 2) Setting up (the plan) a process to help mitigate the potential occurrence; 3) Mapping responsibilities, scope, objectives, involved parties, and any constraints; 4) Putting a framework in place to handle risks; 5) Analyzing probabilities of certain risks or hazards based on all available information; and, 6) Finding ways to solve risks as quickly as possible so that down time and/or fiscal risk is limited (Wan, 2009; Frenkel, Hommel, & Rudolf, 2005). Most experts in the field suggest that Hazard and Risk analysis can be completed using a relatively simple formula: Risk Index = Impact of Risk Event(s) X Probability of Occurance. Then, looking at a

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