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Risk management is both a process and a professional occupation in the business world. If you are studying business or finance, it is very important to understand both the process of managing risk and what types of positions would be considered risk managers in their own right. For students and just individuals who are interested in learning more about business, education is crucial. If you are not familiar with the role of risk managers or the process itself, read on and get straightforward information that you may use in the future.
What Does the Process Entail?
When managing risk, you will identify, evaluate and analyze risk in addition to monitoring risk control. The entire purpose of the process is to prevent loss and to mitigate the affects of a loss that is inevitable.
There are a variety of types of losses that professionals in the field monitor for and them mitigate. Some of the various types of risks that can present themselves and lead to loss include: financial risks, strategic risks, perimeter or geographic risks, and operational risks. The management process goes much deeper than just predicting losses and looking for solutions. To effectively manager risks, you must:
* Identify exposures to loss
* Measure how often and how severe the loss could be
* Examine alternatives to avoid the loss
* Decide which alternatives are best to use
* Implement the techniques that you have decided upon
* Monitor the results once implemented
Why is Managing Risk So Important For Organizations?
You might just assume that the unexpected will happen when you own or operate a business and you must be prepared to pick up the pieces. While this is true in some cases, the entire reasons that the largest firms and corporations hire risk managers to evaluate the company and analyze risks is to prevent losses that are preventable. Managing risk is a very important focus because of what the process can do. If done properly, managing risk can help you save resources, protect your public image, protect the environment, reduce the chance of injury, and reduce legal liability.
What Types of Jobs Are in the Field of Risk Management?
If you are seeking a degree in this field or a related field like finance, you might be wondering just what you will be able to do with your degree. There are a long list of different careers that are just for graduates with an RMI degree. The profession that you want depends on the environment you prefer to work in the industry that interests you most. Every title has a problem-solving component as a responsibility. Here are some of the professions to consider: actuarial analyst, financial analyst, compliance officer, underwriter, consultant, risk analyst, and general manager.
Risk managers are sound decision-makers who direct activities and analyze data all while solving other problems that present themselves almost suddenly. It can be a very stressful title to hold, but it can be a financially rewarding one as well. According to Investopia, managers who work in mid-level or senior positions will earn an average of $94,606 per year. Your salary may be even higher if you get certified by the Professional Risk Managers’ International Association. Review the degree options and designation requirements, and then you can decide if risk management is the field for you.
