Every organization manages its risk in some way, but not always in a way that is visible, repeatable or consistent, to support effective decision-making. The task of risk management is to ensure that an organization makes cost-effective use of a risk management process that includes a series of well-defined steps. The aim is to improve internal control and support better decision-making through a good understanding of individual risks and the overall risk exposure that exists at a particular time. Some risk-taking is inevitable if an organization is to achieve its objectives. Those organizations that are more risk aware appreciate that actively managing not only potential problems (threats) but also potential opportunities provides them with a competitive advantage. Taking and managing risk is the very essence of business survival and growth. Effective risk management is likely to improve performance against objectives by contributing to fewer sudden shocks and unwelcome surprises, more efficient use of resources, reduced waste, reduced fraud, better service delivery, reduction in management time spent fire-fighting, better management of contingent and maintenance activities, lower cost of capital, improved innovation, increased likelihood of change initiatives being achieved, more focus internally on doing the right things properly, more focus externally to shape effective strategies and so on. Many of these benefits are applicable to both the private and public sectors. Whereas the private sector focuses mainly on shareholder returns and the preservation of shareholder value, the public sector’s role is to perform cost-effectively, in accordance with government legislation and policies. khmergood/index.php?option=view_detail&catid=82&itemid=31
Posted on: Tue, 03 Sep 2013 06:54:26 +0000
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