Chapter One
1. In your own words, what is risk management?
Risk Management is the process that a company goes through to define organizational assets, threats and vulnerabilities and devise ways to protect them. According to Roper, the importance of risk management as a single function, for an organization is becoming more and more understood within the upper levels of business management (Roper, 1999). Additionally, CEO’s, COO’s and CFO’s worldwide know that every decision will have pros and cons that will carry some degree of risk (“Risk Management”, n.d.).
According to Best Practices website; “Effective risk management delivers far-reaching benefits to all organizations and allows them to keep the business profitable and the organization running”. The benefits of risk management will include:
•Better basis for strategy setting
•Improved service delivery
•Greater competitive advantage
•Less time spent fire-fighting and fewer unwelcome surprises
•Increased likelihood of change initiatives being achieved
•Closer internal focus on doing the right things properly
•More efficient use of resources
•Reduced waste and fraud, and better value for money
•Improved innovation
•Better management of contingent and maintenance activities.
Today there are several strategies and templates out there to help businesses execute risk management at an organizational level. The security professional is also being tasked with acquiring the skills of a risk manager and this is adding new levels to the job.
2. Risk Management is said to be a systems approach. What are the advantages of using a systems approach in the risk management process?
The need for an organization to protect its assets is critical to the organization’s survival. A “...
... middle of paper ...
...tion process. In the security field there are many consultants and consultation companies that will provide this kind of service. Even in organizations that have an in-house security expert, periodic assessments from an outside auditor is often recommended, but regardless of the source, periodic assessments must be made and, in turn, the security manager must be prepared to use all available resources to create a proactive and reactive defense strategy. Because a variety of automated and non-automated methods are employed, the security manager needs to stay current on the known and emerging threats and countermeasures if he expects to be prepared to protect organizational interests. Continuing education, research and periodic risk assessments will all play a part in the success of a comprehensive information security package and effective management practices.
Security helps the organization meet its business objectives or mission by protecting its physical and financial resources, reputation, legal position, employees, and other tangible and intangible assets through the selection and application of appropriate safeguards. Businesses should establish roles and responsibilities of all personnel and staff members. However, a Chief Information Officer should be appointed to direct an organization’s day to day management of information assets. Supporting roles are performed by the service providers and include systems operations, whose personnel design and operate the computer systems. Each team member must be held accountable in ensuring all of the rules and policies are being followed, as well as, understanding their roles, responsibilities and functions. Organizations information processing systems are vulnerable to many threats that can inflict various types of damage that can result in significant losses (Harris, 2014). Losses can come from actions from trusted employees that defraud the system, outside hackers, or from careless data entry. The major threat to information protection is error and omissions that data entry personnel, users, system operators and programmers make. To better protect business information resources, organizations should conduct a risk analysis to see what
Value at Risk has been called the “new science of risk management.” Around the world, organizations are sprinting to implement the new technology.
The way forward lays in a security risk management (SRM) approach that protects your company from the most severe threats to critical IT systems and operational processes. SRM helps your organization understand its assets and analyze the vulnerabilities it must address. Security risk management also facilitates internal and external compliance initiatives. It enables your organization to enforce policies that relate to the integrity of customer data, the configuration of corporate applications and databases, and the accuracy of financial reports. Companies that take a systematic approach to SRM reap additional benefits: operational efficiencies that lead to better management of resources and reduced costs. It's up to all the parties involved in the IT operations and security mission to demonstrate that they can take on the demands of this new challenge.
In order for project and program managers to create and execute successful projects, they must fully understand the importance of identifying and dealing with risks associated with their projects. According to Bezzina, Grima, and Mamo (2014), “effective risk management frameworks and strategies are developed with the intention of improving performance, and creating the baseline for the continuity of uninterrupted efficient business processes through risk management good practice” (p. 593).
Risks- how the organization will cope with the uncertain risks with their management approach and plan.
When trying to create a positive risk management culture as a manager it is important to make sure that all employees of my organization realize the importance of managing risk. Some of the factors to consider when attempting this approach would be:
The first area that I feel would benefit from a risk management strategy is employee health, specifically in the area of post-traumatic stress disorder(PTSD). Many employers offer employee assistance programs, but these programs only cover a few sessions and just barely touch the surface of possible issues employees experience. Many employees attempt to deal quietly post-traumatic disorder symptoms and its secondary symptoms such as substance abuse,divorce and other forms of depression. Many think personal complaining of this type of issues is weak and must deal with completely on their own. However, this suddenly changes when it affects their co-workers and their employer.
Risk management is defined by the Department of Homeland Security (DHS) as “the process of identifying, analyzing, assessing, and communicating risk and accepting, avoiding, transferring or controlling it to an acceptable level considering associated costs and benefits of any actions taken” (DHS 2010a, p. 30). Raymond Decker, Director of Defense Capabilities and Management testified on behalf of the U.S. Government Accountability Office (GAO) before the Subcommittee on National Security, Veteran’s Affairs, and International Relations; House Committee of Government Reform, and further described risk management as the “systematic and analytical process to consider the likelihood that a threat will endanger an asset,
To successfully manage risk, an ERM initiative for company Whitestone must be enterprise wide and viewed as an important and strategic effort. Several executives have significant responsibilities for ERM, including the CEO, CRO, CFO, and chief audit manager, the ERM process works best when all key managers of the organization contribute. The COSO framework states that managers of the organization “support the entity’s risk management philosophy, promote compliance with its risk appetite and manage risks within their spheres of responsibility consistent with risk tolerances.” Therefore, identifying leaders throughout Whitestone and gaining their support is critical to successful ERM implementation. A goal of ERM is to incorporate risk management into the organization’s agenda and decision-making processes. This means that ultimately, every manager is responsible, which can only happen when performance goals are clearly articulated, and the appropriate individuals are held accountable for
To manage risk management there have some step that should be followed. First, identify the risk, whether the risk will occur from production , marketing or legal risk. Second, measure the risk, which is the probability of outcome that will occur. Third, assess the risk that be bearing, scan the strategies that will be taken it suitable or not with the person who bear it. Fourth, evaluate the risk by tolerance or preferences, whether to face or avoid the risk based on the revenue in future. Fifth, set the risk management goal, what the outcome that will arise and analysis of objective to be a reality. Sixth, identify the effective tools, difference risk, differ to...
Our most important goal, as previously stated, is to examine and evaluate our current risk management team. An effective risk management team will be able to easily identify a project’s strengths and weakness, and as a result, they will also be able to generate strategies to aid or hinder that project (Duggan “Why is Risk…”). I call out our current risk management team in
No firm can be a success without some form of risk management. Risk are the uncertainty in investments requiring an assessment. Risk assessment is a structured and systematic procedure, which is dependent upon the correct identification of hazards and an appropriate assessment of risks arising from them, with a view to making inter-risk comparisons for purposes of their control and avoidance (Nikolić and Ružić-Dimitrijevi, 2009). ERM is a practice that firms implement to manage risks and provide opportunities. ERM is a framework of identifying, evaluating, responding, and monitoring risks that hinder a firm’s objectives. The following paper is a comparison and evaluation to recommended practices for risk manage using article “Risk Leverage
Risk management is a process used in all industries to reduce the risk. The Risk management tool usage changes from sector to sector and hence each sector has developed their own risk management tools and methodologies to mitigate the risk. But the concept remains the same behind all the tools (Ropel, 2011). The main steps for risk management irrespective of the sector are:
Risk mitigation is also the process of controlling actions, which are identified, and selecting the suitable ones to reduce risk according to project objectives (Pa, 2015). Risk mitigation is important in IT organizations in so many ways. According to Ahdieh, Hashemitaba, Ow (2012), mitigation of risk provides a mechanism for managers to handle risk effectively by providing the step wise execution of the risk handling (as cited in Pa, 2015, pg. 49). Some risks, once identified, can readily be eliminated or reduced. However, most risks are much more difficult to mitigate, particularly high-impact, low-probability risks. Therefore, risk mitigation and control need to be long-term efforts by IT project managers throughout the project lifecycle. There are three types of risk mitigation strategies that hold unique to Business Continuity and Disaster
Risk Management allows us to identify the problems which are unknown during the start of the project but may occurs later. Implementing an efficient risk management plan will ensure the better outcome of the project in terms of cost and time.