The risk management planning processes encompasses several general areas, including organizational structure, risk tolerance, and mitigation...

The risk management planning processes encompasses several general areas, including organizational structure, risk tolerance, and mitigation vs. elimination. Share at least two examples that compare how organizations’ different structures, risk tolerances, and mitigation strategies affect risk management planning

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Expert Solution

Two examples which illustrate how structure and culture of the company can affect risk management planning are as follows:

A manufacturing company has a hierarchical structure where decision is usually taken by the management. There is close to minimal involvement of the employees in the strategy formulation and decision making. Hence risk planning is also done with least involvement of the employees. The risk management in such scenario is not comprehensive. The employees do not have full awareness about the risk management process and there may be lack in accuracy in handling the same.
A startup company has a flat structure. There are only 2-3 layers in the overall structure of the company. Every employee is given the autonomy to handle his or her work. Decision making is a collaborative process and involves employees from all levels. In such a scenario, risk planning and management is quite a comprehensive process. This is so because various minds work with the objective of analyzing risks which may affect the process impact its overall functionality. A comprehensive risk planning will help in maintaining quality adherence as well as efficiency and effectiveness of the process.

keosha answered 1 year ago

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