The paper "The Importance of Enterprise Risk Management in Target and Jima Construction Company" is a good example of a case study on management. Even though the construction industry is project-based, risks at both enterprise and project levels should be covered through risk management since emphasizing more on project risk management could result in a number of limitations. As an integrated and holistic approach to the management of risks, enterprise risk management (ERM) manages the firm’ s entire risk portfolio and is deemed to be beneficial in the construction industry.
In the majority of projects, the identification and analysis of risks happen in a brainstorming and random fashion. Normally, this could be fatal to the project's success since the likelihood of unforeseen risks to increase is exceedingly high. Since they are not planned for or assessed, they must be handled on an emergency basis, instead of preparing and defending against it in a measured and planned manner. Early in the stage of preparation and planning, it is imperative to identify, evaluate, and categorize potential risks. The ERM is crucial since its success decides on survival as well as the health of the business enterprise.
When a construction company is unsuccessful in identifying risks, it would become ill-prepared to overcome risk events. The objective of this piece is to evaluate how the COSO framework can be used to add value to risk management at Target & Jima Construction Company (T& J). A Review of the State-Of-The-Art in Enterprise Risk Management Recently, the business landscape has changed in ways that companies have started adopting risk management practices, and this has shifted towards a more comprehensive, integrated risk management discipline, commonly referred to as ERM.
ERM has been defined by COSO as a process adopted by a company’ s management, the board of directors, as well as other personnel, integrated into the process of setting strategy and across the business with the aim of identifying possible events which could influence the organization, and making sure that the risk has been managed within its risk appetite, to offer a rational guarantee with regard to the realization of the organizational objectives (Renault et al. , 2016).
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