How does the practice of crisis management differ from that of Risk Essay

How does the practice of crisis management differ from that of Risk managementsupport answer with reference to appropriate exam - Essay Example Woods et al. (2008, p. 124) identified the core elements of risk management in Figure 1 below. Figure 1. Core elements of corporate risk management Source: Woods et al. (2008, p. 124) 2.2 As indicated by Figure 1, the assessment of risks in the area of risk management is done consistent with organisational objectives (Woods et al. 2008, p. 125). The word â€Å"modification† on the left side of the diagram indicates a feedback process in which the lessons learned from risk management experience are used to review and modify management decisions and even organisational objectives â€Å"to ensure an acceptable and appropriate level of risk exposure on the part of the organisation† (Woods et al. 2008, p. 126). 2.3 The label â€Å"formal audit† on the right side of the diagram indicates that â€Å"formal audit† is the key route for identifying and managing risks (Woods et al. 2008, p. 127). ... ned in the event of a crisis; Provide the required focus for effective response; and Conduct exercises to validate and improve crisis response plans as well as improve staff training and awareness. 2.4 In 2009, the Organisation for Economic Cooperation and Development (OECD) identified some of the developments in country risk management that could be applicable for other forms of risk management (p. 29-38): Adoption of an all-hazards framework that considers all possible sources of risks; Use of new governance models for risk assessment; Involvement of all organisational units for risk management; Systematic approach to mitigation planning in anticipation of the possibility that some or all of the risks would materialize; Protection of critical infrastructure given the risks; Promotion of organisational resilience and continuity should some of the risks materialize; and Ensuring that financing policies factors in the possibility of crises from risks. 2.5 It is easy to see that some o r all of the developments for various countries risk management strategies apply to corporate and other types of risk management as well. This implies, for example, that: We must identify all sources of risk that threatens the survival or competitiveness of our organisation or population on which our organisation has a responsibility (with a priority emphasis on those that constitute as the biggest threat to our existence or competitiveness); We must adopt forms of organisation that factors in the realities of risks, We must involve all our organisational units in risk assessment even if we have a unit focused on risk management; We must have crisis-mitigation plans as part of our risk management system (the crisis mitigation plans are also part of our crisis management system); Based on