RISK MANAGEMENT STRATEGY

1. RISK MANAGEMENT STRATEGY

2. STRATEGIC MANAGEMENT PROCESS FOR RISK MANAGEMENT MISSION Industry Analysis External Internal Environmental Long term objectives Grand Strategies Functional Strategies Short term objectives Policies Monitoring

3. MISSION STATEMENT • Sets out the philosophy of risk management in conjunction with organisational mission • A statement of the values and beliefs of the organisation with regard to risk management • Signed by top management

4. COMPOSITION OF LONG TERM OBJECTIVES • Time period - five years • An attribute - (Reduction in accidents) • An index (by 50%)

5. QUALITY OF OBJECTIVES • Acceptable • Flexible • Measurable • Motivating • Suitable • Understandable • Achievable

6. CHARACTERISTICS OF STRATEGIES • Broad statements of intent which show the types of action required to achieve the objectives. • Strategies need to translate into actions and tasks • Need to exercise control so as to monitor achievement of strategies

7. SHORT TERM OBJECTIVES • Time period - Approximately one year • More focused than long term objectives • More specific than long term objectives • Applied by functions • Measurable • Prioritised • Example - Within next six months train all labourers and 20% office staff in manual lifting

8. CORPORATE OBJECTIVES Long Term Survival Maintenance/ Improvement of Services Cost Minimization Social Responsibility Quiet life Minimizing Expected Costs Controlling Variability of Costs (Losses) Reducing Risk Costs Preventing Losses RISK MANAGEMENT OBJECTIVES

9. POLICIES • Directives to guide the thinking, decisions and actions of managers and subordinates in implementing the organisation’s strategy. • Often called standard operating procedures

10. CONTENT OF POLICIES • General description of risk management and its importance to the organisation. • Gives position of risk management within the organisational structure. • Sets out reporting relationships • Outlines scope of the authority of the risk management professionals. • States senior management’s objectives for making using of risk control and risk financing techniques • Provides decision rules for various risk management techniques • Tailored for each organisation.

11. QUESTIONS??