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Man at his Desk

Risk management is the continuing process to identify, analyze, evaluate, and treat loss exposures and monitor risk control and financial resources to mitigate the adverse effects of loss. Loss may result from the following: financial risks such as cost of claims and liability judgments.

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You don't have to cross your fingers and hope your business remains protected from bad luck.

  • Step 1: Identify Your Risks. ...

  • Step 2: Analyze All Risks. ...

  • Step 3: Evaluate and Prioritize Every Risk. ...

  • Step 4: Treat Your Risks. ...

  • Step 5: Monitor Your Risks. ...

  • Risk Management Strategy. ...

  • Risk Assessment. ...

  • Risk Response.

There are five basic techniques of risk management:

  • Avoidance.

  • Retention.

  • Spreading.

  • Loss Prevention and Reduction.

  • Transfer (through Insurance and Contracts)

5 basic principles of risk management

  • #1: Risk identification. ...

  • #2: Risk analysis. ...

  • #3: Risk control. ...

  • #4: Risk financing. ...

  • #5: Claims management. ...

  • Bringing risk management principles to life

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  • There are at least five crucial components that must be considered when creating a risk management framework. They include risk identification; risk measurement and assessment; risk mitigation; risk reporting and monitoring; and risk governance.

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  • ​The activities associated with risk management are as follows: • recognition of risks; • ranking of risks; • responding to significant risks; • resourcing controls; • reaction (and event) planning; • reporting of risk performance; • reviewing the riskmanagement system.

10 PRINCIPLES OF RISK MANAGEMENT

  • RISK MANAGEMENT STARTS AT THE TOP. ...

  • RISK MANAGEMENT NOT ONLY IN THEORY. ...

  • COMPLEX IS NO REMEDY. ...

  • RISK MANAGEMENT IS STRATEGY AND STRATEGY IS RISK MANAGEMENT. ...

  • RISK MANAGEMENT IS MORE THAN A POLICY, IT IS A CULTURE. ...

  • A RISK-AWARE FOR THE WHOLE SYSTEM. ...

  • WHAT MATTERS IS THE “TALK”, NOT THE “REPORT”

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  • Risk management comes in many forms, but one approach, which I call the 3As, looks at three different risk management styles:

  • Actuarial - the law of large numbers.

  • Active - the law of the land.

  • Adversarial - the law of the jungle.

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