Risk Management and Its Criteria

664 Words3 Pages
The complexity of modern organization requires a way to pre-plan and assess situations that may be detrimental to the organization. Risk management is one way to identify issues that may occur to disrupt business; to assess in detail the quality and quantity of those risks, and to prioritize how managing those risks can contribute to the organization's overall success. The purpose of risk management is to be proactive in improving places or processes within an organization that may have risks that can be mitigated or controlled and to do something to minimize those risks and the financial exposure to them. In almost any organization, there are potentials for risk within a construction project there may be supply or labor issues; within a small business stock, weather or employee issues; or in other organizations uncertainty in markets, legal issues, credit risks, accidents, natural causes or disasters, deliberate competitive attacks, and a host of other unpredictable cases. So rife are risks for organizations, that standard and have been developed by national and international bodies, insurance agencies, and regulatory agencies to help organizations identify and minimize risk (International Organization for Standardization, 2009). Basic risk management for any organization encompasses six general parameters" 1) The identification of a risk within the context of the organization or area; 2) Planning some sort of a process to mitigate the situation(s); 3) Mapping, either
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