risk management - Director Magazine

EVER FEEL LIKE STAYING IN BED?
crossing the road, then de-activate the burglar alarm as you open up the office.
Three separate examples of risk control before your first coffee of the morning.
A trite example, maybe, but nonetheless a useful illustration of how good we are
at managing risks when the benefits of doing so are obvious. Most of us,
though, could be even more risk-conscious. And most directors could implement
risk management in their business in a way that makes the company stronger
and their own personal position more secure.
Effective risk management requires you to understand your business intimately
and to ask:
how do different operations and processes interact?
what if key facilities and people were not available?
when would we be unable to operate?
what if the unlikely and the unexpected actually happened?
According to the Risk Management Standard, the objective of risk management
is: “To add maximum sustainable value to all the activities of the organisation.
It marshals the understanding of the potential upside and downside of all
those factors which can affect the organisation. It increases the probability of
success, and reduces both the probability of failure and the uncertainty of
achieving the organisation’s overall objectives.”
In short, risk management is good management. The following chapters in
this guide will explain how to identify the threats and risks facing your business
and how to plan to eliminate, reduce or transfer these risks.
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