Risk Management Process:

Risk is an threat or hinderance to the smooth functioning of operations of the organization. It must
be treated effectively to avoid or reduce the negative impact it has on the organization.

Risk Manangement Process is an ongoing process which ensure to avoid or minimize the negative
effect of risks which occurs in the business. Every business has various risks types of risks. An
organization has to evaluate such risks and manage them accordingly to ensure that business
functions smoothly and that's the purpose Risk Management Process concept has been came into
the existence.

For the effctive Risk Management Process there are many process which shall be followed to
manage the risks effectively. In this process an organization has to follow some steps which has their
own significance.

Steps in the Risk Management Process:

1. Recognition or identification of risks:

The very first step in the Risk Management Process is to identify the events which can be turned into
risk if not manage properly. An organization has to identify the risks in effective manner.

2. Measuring the effects of risks:

Once an organizations identify and finds the events which are risks for its function, it must analyse it
as per the impact each risk has on the functions and organization. Each risk must be measured as per
its effect be it benefit or loss.

3. Prioritizing the risks:

An organization must rank the risks as per their effect or severeness it has on the organization and
its functions. It must be treated as per their ranks.

4. Response to the risks:

Response to the risk is the main purpose for which the Risk Management Process came to existence.
Response must be treated in the efficient manner to convert threat into opportunities or reduce the
negative impact of the risks.

5. Review and control : Risk Management Process is an ongoing process. Even after the risk is treated
effectively it must be reviewed on an specific interval. The controlling process of the Risk
Management Process must be ongoing.