By using risk management, managers hope to identify, analyze, avoid, minimize, or eliminate risks that may harm their business. There have been a number of mistakes in risk management and it is important for companies to be aware of them. One mistake is the use of poor governance. Effective management leads to openness and commitment that will enable risk management to function effectively. If a company does not have a leading role, it limits its risk management capabilities. It is important to be disciplined in risk taking especially in the context of rapid growth and favorable markets. Border, checks, and balances must be and monitor.
Another erroneous calculation followed by executives follows the "tribe mentality". If a company carries out a large amount of activity, especially for mortgage brokers, creditors, mortgage brokers, investment bankers and institutional investors, it is easier for a manager to ignore the risks. If a manager looks at another manager, ignoring the risks, he probably tends to follow them. To avoid this, everyone should be aware of the company's financial situation.
Misunderstanding is "if you can not measure it, you can not handle it" your thinking is a mistake of expectation. Many leaders use this approach as objections, so you do not have to fully understand or recognize the risks involved. Another faux pas manager adopts the lack of transparency in high risk areas. Many leaders decide on the lack of information. It is important for leaders to see the full picture before making decisions. Executive management needs to develop a risk assessment in all areas of business.
Some companies provide tremendous oversight when they do not integrate risk management with strategy setting and performance management. When developing a strategy, it is important to take into account all risks. If the risks are behind, the leaders get unrealistic strategic goals. Thus, it leads to a strategy that can worsen the company's competitiveness, cause problems in a changing business environment and loses business.
Another oversight that can have a drastic impact on addressing risks does not include the forum on time. If a problem arises, the board should be informed as soon as possible, not the fact. It is important to know the body with the organization's risk profile.
There are a lot of risks to running your business. Leaders should work in ways that benefit their business and understand the risks inherent in the business and be able to approach them realistically.
Source by sbobet