Techniques of implementing enterprise risk management in a business organization

1. Introduction to the Concepts of Enterprise Risk
Mangament In a Business Organization

2. What is Enterprise Risk Management
Enterprise Risk Management
in simple terms is defined
as the methods and
procedures used by
different organizations
managing the risks and
seizing the opportunities
related to the
achievements in their
business organizations.

3. What is Enterprise Risk Management
Enterprise Risk Management in any said to a part of
any business lexion and understanding managing the
risks at its most important concern.

The Risk is said to be inherint in the Business.

When Given importance risk management it is not
shocking that risk management is receiving scrunity from
the top business organizations, banks, financial
institutions and many more.


4. Enterprise Risk Management
Business
Organizations
Management Process
has thus become
synonymous when
compared to the
process of enterprise
risk management


5. Sources of Enterprise Risk Management

Interest Rate Risk: It is
generally the adverse effect
of the interest rate
movements on the profit of a
particular firm or the balance
sheet. It is affected in two
major ways one is by
affecting the firms and the
other is through the assets or
the liabilities.

6. Sources of Enterprise Risk Management



Financial Risks: Generally
refers to the bankruptcy and
the possibility of the firm who
is not able to repay the debts
on time.
Higher the debt equity ratio
firm higher would be the
financial risks faced by it.
Liquidity risks and having the
wrong capital structure are
the major reasons for the
financial risks.

7. Sources of Enterprise Risk Management
Business Risks: Risks
faced by most of the
business organizations from
the internal and the external
environment.


Labour strike, death of key
personal and machinery
break down etc are some of
the internal causes.
External Causes would
include government policy,
changes in the customers
preferences etc.


8. Sources of Enterprise Risk Management
Market Risks: It is
generally the value of all
the investment firms going
down as a result of the
movements caused in the
market. Market Risks is
also know as the price
risks.


9. Changing form of Enterprise Risk Management
We all know that enterprise risk management is
associated with each and every business. But
when it comes to financial system risk is not
apparent.

The earlier ethos detect, inspect, react have
been substituted with some of the major concepts
like anticipate, prevent, monitor and mitigate.


10. Enterprise Risk Management - Process
Enterprise risk management includes the following process

Identifying the major risks: Each and every corporate needs to
identify the possible sources of risks and the types of risks faced in
the organization.

Determining the major objectives: This includes the profits, or
the developed competative advantage.

Decided to be management.

Risk Evaluation process: Once the risk in the organization is
identified they need to be evaluated by ascertaining their
significance.

Development of the policy: This is based on the tolerance level
of the firm where the risk management policy needs to be
developed.

11. Enterprise Risk Management Techniques
Enterprise Risk Management involves the
following techniques.

Internal Techiques: Internal Techniques here
are the part of the day to day operations of the
particular firm.

External Risks: They are the ones who require
the company to enter the financial contract with
the market entity.

12. Enterprise Risk Management Techniques
Management of Business Risk: Some of the
businesses are not manageable, they are something that
have to be borne.

Asset Liability Management: Is generally an effort
put to minimize the exposure to the price risk along with
the combination of assets and liabilities in order to meet
up the needs and requirements of the firm .


13. Guidelines for Enterprise Risk Management
Proper mix of enterprise risk management techniques:
Involves most optimum mix of the risk control, prevention,
and retention.

Common goal of risk management and financial
management: Creating the share holders wealth

and generating the net present value.

Proactive enterprise risk management process: Number
of uncertainities caused when compared to the financial
market.

Continous changes in the interest rate, exchange rate,
commodity prices, economic variables, and external
environment a reality.
