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Risk Management

all available facts should be collected and as many
expert opinions should be sought. Subjective
probability estimates are a mixture of statistical
observation and personal judgement. Though
skeptics often find these estimates suspicious, they
usually provide practical and useful guidelines.

Q6. Describe the role of risk manager in (a) risk
identification and (b) risk evaluation.

Ans. The role of risk manager are:-
(i) Risk analysis - it again has two prime element:
(a) Identification of risk - which requires a thorough
knowledge of organization, the market in which it
operates, the legal, social, economic, political and
climatic environment in which it does business, its
financial strengths and weaknesses, its vulnerability
to unplanned losses, the manufacturing processes,
the management system and the business mechanism
by which it operates.

Any failure at this stage to identified any risk may cause
a major loss which can leave the organisation exposed
to the chance of bankruptcy. Risk identification provides
the foundation of risk management.

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