Today, systematic risk management is one of the key advantages when it comes to running a lucrative business. We believe every modern business organization should implement risk management process. That means that all stakeholders should be involved in the process, starting with the management. Management as one of the key stakeholders should be able to make informed decisions, as it is their purpose. And making good decisions leads to success and prosperity.
In our extensive experience working with companies of all sizes, we identified four typical challenges organizations, their employees and all impacted stakeholders recognize in their operations.
• Management doesn’t see the value in risk management
• Organizational structure is unsuitable
• Risk management culture is not developed
• Risks are not quantified
These challenges impact the company’s performance on the inside and public aspect. From operational activities to the profit-based performance, if those challenges are not addressed, they can even affect the survival of the company.
All decisions are based on two parameters, knowledge, based on experiences and information, that is available to us. Decision to implement risk management process is therefore crucial for the future success of the company.
As one quote from one of the most respected global companies Ernst & Young puts it:
“Companies in the top 20% of risk maturity generated three times the level of EBITDA as those in the bottom 20%.”
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