Risk Management Process and Culture

The assignment content discusses the risk management process from various perspectives. It compares and contrasts different approaches, including those of DoD, Kerzner, Pritchard, PMBOK, and Department of Commerce Australia. The risk culture influence on the risk management process is also highlighted, emphasizing the importance of a risk-taking culture for effective risk management. Additionally, the article describes the risk management process in an organization, highlighting its five steps: identification, analysis, evaluation, planning, and monitoring. Finally, the importance of risk management is stressed, as it ensures that potential hurdles are identified and mitigated in the initial stages of a project.

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Risk Management Process
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RISK MANAGEMENT PROCESS 1
Comparison Matrix
The table below shows the comparison of descriptions of the risk management processes
identified by DoD, Kerzner, Pritchard, PMBOK, and from Department of Commerce
Australia.
DoD Kerzner Pritchard PMBOK DoC Australia
As per US DoD,
risk is has six
aspects, namely,
planning,
identification,
analysis,
handling,
monitoring, and
implementation.
All these are
intertwined
together with
strong
communication
and feedback
(Department of
Defense, 2015).
As per Kerzner,
Risk
management
process covers
potential risk
identification,
formal planning,
impact analysis
of risks, strategy
formulation for
risks, and
monitoring and
control of
progress
(Kerzner, 2013).
As per Pritchard,
risk
management
process is of five
steps that
includes risk
identification,
risk
qualification,
risk
quantification,
risk planning,
risk monitoring
and control
(Pritchard,
2014).
As per PMBOK,
risk
management
process is of
four steps
namely, identify
risk, assess risk,
control risk, and
review controls
(Stackpole
Snyder, 2013).
The Australian
government’s
Department of
Commerce
applies six-step
process and they
are establishing
context,
identifying and
defining risks,
conducting
analysis,
conducting
evaluations,
developing and
implementing
treatments, and
monitoring,
reporting,
updating, and
managing risks
(Department of
Commerce, ).
Risk Culture influence on Risk Management Process
Risk culture refers to the values and behaviours that exist in the firms which shape the
various aspects of decision making of the managers and subordinates. If the culture of an
organization is not to take risks seriously then it is likely that there will be little to no
provision to handle probable risks (Ingram et al, 2015). On the other hand, if the culture is to
tread carefully after assessing every possible risk, then such organization might have
adequate risk management process.
Use of Risk Management Process in Organization
The risk management process within the current organization follows five steps, namely,
identification of risk, analysis of risk, evaluation of risk, risk response planning, and
monitoring and reviewing the risk. This process is used once in a while, mostly every six
months (Hopkin, 2017). Though it has been suggested that the risk monitoring and review

RISK MANAGEMENT PROCESS 2
should be an on-going process to ensure that the risks mitigation stays on place because, like
this organization there are many firms that develop risk plans but rare due diligence is given.
Importance of Risk Management Process
The project risk management is important as it ensures that the likely certain or uncertain
hurdles of the project are identified at the initial phase of the project and proper mitigation
plans are implemented. Many organizations struggle to implement it due to multiple reasons
such as absence of risk culture, lack of experience, complex environment, and others (Kerstin
et al, 2014).
References
Department of Defense,. (2015). Risk, Issue, and Opportunity Management Guide for
Defense Acquisition Programs. Washington: Department of Defense.
Hopkin, P. (2017). Fundamentals of risk management: understanding, evaluating and
implementing effective risk management. Kogan Page Publishers.
Ingram, D., Underwood, A., & Thompson, M. (2015). Risk culture, neoclassical economics,
and enterprise risk management.
Kerstin, D., Simone, O., & Nicole, Z. (2014). Challenges in implementing enterprise risk
management. ACRN Journal of Finance and Risk Perspectives, 3(3), 1-14.
Kerzner, H. (2013). Project management: a systems approach to planning, scheduling, and
controlling. John Wiley & Sons.
Pritchard, C. (2014). Risk Management Concepts and Guidance (5th ed.). Florida: CRC
Press.
Stackpole Snyder, C. (2013). A User's Manual to the PMBOK Guide (5th ed.). Hoboken:
Wiley.