Answer to Question #229069 in Management for geoffrey

Question

Discuss the key stages of risk management process making reference to a commercial bank such as absa

Answer 1

Major steps in the risk management process

The risk management process is a continuous process of identifying, treating, and managing the risks (Lucid authors, 2021). Investing time to design a risk management strategy resembles installing a fire alarm that you wish never goes on, but you are willing to deal with the minute inconvenience.

There are several steps of risk management process;

Step; Identifying the risks. It takes courage in the organization to trace the prospective risks that may hinder the effectiveness of an organization (Kloosterman, ND). It is worth knowing the possibility of a downfall. The bank managers in Absa bank are key resources in risk determination because they hold valuable knowledge about the operation of Absa. The Absa bank managers hold meetings and share experiences of previous risks and insights into possible solutions. The identified risks are recorded in the project risk log in a descending manner.

Step 2. Risk analysis

After identifying a risk, it is analyzed deeply and thoroughly to identify the probability of its occurrence. ABSA bank managers analyze specific risks and the possible effects the risk might cause. On analyzing the risks, discrete patterns of soft spots that pose can be possibly identified.

Step 3; Risk prioritization

The ABSA bank prioritizes risks and numbers them basing on the possibility of their occurrence and the lethality of the risk. The most extreme and probable risk to occur. Correct prioritization ensures that the ABSA  risk management team focuses their energy on the correct risk.

Step 4. Risk treatment

The step entails installing the cushion measures to combat the risk. The ABSA leaders design the best options to combat the risk and neutralize it before it cancerously devours other departments. The risk treatment process can be conducted while the project is active. The risk management strategies can be obtained from previous treatment methods

Step 5; Risk monitoring

After risk treatment, the ABSA management team monitors the risk to ascertain the effectiveness of applied strategies. Suppose the treated risk ceases to appear. The management team focuses on the next risk.

The risk management steps entail risk identification, analysis, treatment, and risk monitoring.

 

Kloosterman, V (ND) Five risk management steps. CPD https://continuingprofessionaldevelopment.org/risk-management-steps-in-risk-management-process/

Lucid authors (2021) Five steps to any effective risk management process. https://www.lucidchart.com/blog/risk-management-process