Corporate Risk Management: New Horizons

Corporate Risk Management: New Horizons In researching a variety of work scenarios and risk mitigation factors, I found my horizons considerably broadened in terms of risk management. Generally, the areas of risk management that taught me most include inherent risk, terrorist risks, and environmental risks. The most striking of these for me is the risk factor associated with terrorism. Globalization is a vitally important concept in business today. No business that seeks to expand beyond its current boundaries can ignore this factor.

Indeed, it has become one of the most important factors of business to such a degree that effective intercultural communication and an understanding of foreign paradigms are vitally important in understanding not only the risks involved, but also the specific factors required for making a success of global business. This integrates closely with the terrorism factor. The events of 9/11 have brought home not only to the government, but also to businesses, the reality of terrorism threats. This reality is all the more poignant when expansion to other countries is considered.

When a company considers expansion, terrorism is a factor that must be calculated as a necessity for the prior risk assessment category. This is also interesting in terms of the retrospective paradigm. Terrorism is not only a vague future threat. It is also a factor of past reality, which makes it somewhat easier to quantify and prioritize. Many risk management agencies for example suggest specific measures to mitigate risks of terrorist attack. Another interesting feature about risk management is the fact that risks and their mitigation can be integrated.

Terrorism may for example be integrated with natural disasters and other unforeseen or unknown risk factors. This has the advantage of simplifying the risk management measures implemented by a company. My horizons have also expanded in terms of communication methods in order to familiarize personnel members with risk management information. All personnel need to be fully informed regarding risk management, particularly in terms of disaster, terrorism, or other unknown factors.

Employees and employers therefore need to maintain an open communication system, through which risk management occurs as a dynamic rather than static system. Management should for example provide workers with the opportunity to offer suggestions relating to the current risk management manual. These can be communicated via spoken or written communication. Such a measure provides the opportunity to establish mutual trust within the company, which is vital if risks are to be handled effectively once they occur. Inherent and environmental risks can also be handled via communicating in this way.

By trusting employees to provide accurate information regarding ongoing risk factors, the management of an organization also provides such employees with a sense of trust and perceived importance. Such employees can then be inspired to provide the company with their best effort, as they perceive meaningful work beyond their job description. This is also useful for the company in general, as a risk management team may perceive the obvious risks, while employees who work.