The paper “ Importance of Managing Risk from the Organization's Point of View, Strategies to Minimize Organizational Risk” is a potent example of an essay on management. Risk management is referred to as an interactive process, containing stages that allow continuous enhancement in decision making, when carried out in sequence. The term risk management is employed to a systematic and logical technique of identifying, establishing context, treating, analyzing, communicating, and monitoring risks related to any process, function, or activity in a manner that will permit organizations to maximize opportunities and minimize losses.
The risk management process focuses on minimizing the consequences or likelihood of a certain risk, to a level in which an organization can accept. The risk management process involves a number of stages that include hazard identification, identification of the related risk, and risk assessment which includes assessing risk possibility, consequence, and assigning rectification priority. This is followed by risk control, the risk process documentation, and finally, review and monitoring of the risk process. The risk control stage involves various activities that include risk elimination, risk substitution, risk isolation, administrative controls, engineering controls, and finally, the employment of individual protective equipment (Act Government 6). Importance of Managing Risk from the Same Organization Point of ViewThe success of the organization's risk management process highly depends on how well all the involved stakeholders were involved in the process.
A risk management plan should involve a common goal, which guides all the involved parties in their risk management activities. This enhances the reinforcement of the process other than creating conflicts and diversion in the process. In this regard, it is very important for all the involved parties to share a common perspective in risk management, so as to eliminate diversions that would create loopholes that can increase the chances of the identified risks or introduce new risks.
Shared perspectives enhance effective employment of the risk management plan where all members support the set policies and follow the set procedure to attain the set objectives. They assist in identifying more risks and identifying other possible risk control strategies and thus, they can be said to play an essential role in enhancing the success of the risk management process (Praxiom 1). Defining Scope in Risk ManagementThe effective risk management process involves the definition of the basic restrictions in which risks have to be controlled.
This is done by establishing a risk management framework. As a result, the entire scope of the risk management process is defined or set. Scope definition involves the definition of the primary assumptions for the internal and external environment of an organization, and the general risk management activities and process objectives. To define the risk management scope of an organization, one needs to understand the organization's background and risk, assess the currently employed risk management activities, and develop risk management controls and initiatives structure.
The next step should involve understanding the external environment that the organization works in and define the risks associated with the environment. One should then understand the internal environment of an organization. This will assist in the definition of the risk management scope for that organization (Anisa 1).