SM-075 Wrap Up Lesson

SM-075 Glossary

Follow through this lesson to complete the vocabulary.

​When looking over vocabulary, write a way in your notes/WORD DOCUMENT to remember each word and you will submit this assignment in Canvas in Friday: Oct 29th .

1st Part of Vocab

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1. Acceptance: A risk-response strategy that involves accepting a risk’s consequences because the potential payoff is higher than the losses; also known as risk retention or assumption

2. Audit report: A document that describes the accuracy and appropriateness of a business’s information, processes, and/or systems

3. Avoidance: A risk-response strategy that involves choosing not to do something that is considered risky

4. Brand erosion: The deterioration or destruction of a corporate or product brand

5. Chief risk officer (CRO): An executive responsible for a business’s risk-management activities, which include the planning, controlling, preventing, and limiting of business losses and enhancing possibilities for gain

6. Contingency plan: Specific guidelines and activities used when responding to undesirable circumstances; an alternative course of action

​2nd Part

​Credit downgrade: The reduction of a business’s credit rating or measure of relative credit risk; usually accompanied by an increase in expenses and a decrease in creditworthiness

1. Environmental scan: A three-step process in which businesses gather information about their surroundings, analyze that information, and determine the future impact of that information

2. Exchange rate: The price or value at which one currency can be converted to another

3. Fallback plan: Guidelines explaining what to do and how to recover if a contingency plan fails

4. Financial risks: Possible events and situations that directly impact a company’s cash flow

5. Hazard risks: Potential events and situations that can cause injury or harm to people, property, or the environment

​3rd Part

​Incident log: A record of accidents, injuries, and other mishaps occurring at a particular business or in a certain department

1. Mitigation: A risk-response strategy that involves reducing or controlling the impact of a risk if it occurs

2. Operational risks: Possible events and situations resulting from employee actions, core processes, and daily business activities

3. Proactive: Adapting to the environment in advance of the occurrence of events; taking advantage of opportunities rather than reacting to problems

4. Probability: The likelihood that an event will occur

5. Risk management: A business activity that involves the planning, controlling, preventing, and limiting of business losses and enhancing possibilities for gain

​4th part of Vocab

​Prospective risks: Risks that have not happened before but could occur in the future

Pure risk: A risk that carries the possibility of loss or no loss

Reactive: Hesitant to take action; passive; waiting for changes to occur before acting

Retroactive risks: Risks that have previously occurred

Risk: The possibility of loss (failure) or gain (success)

Risk-averse: Avoiding risk whenever possible

Risk checklist: A standardized list of risks that a business faces on a regular basis; used to speed up the risk-identification process

Risk identification: A risk-management process that involves recognizing risks that could impact a business’s objectives and activities

Risk impact/probability chart: A framework used to determine the severity of risks if they occur; used by risk managers to prioritize risks

​5th part

​Risk measurement: A risk-management process that involves determining the potential severity of different risks

Risk monitoring and control: A risk-management process that involves determining the effectiveness of current risk-response strategies and tools, tracking existing risks, monitoring new risks, and developing responses and workarounds for previously unidentified risks

Risk register: A record or listing of risks that could potentially impact a business or project

Risk response: A risk-management process that involves selecting the most effective ways to handle different risks

Risk-seeking: Looking for ways to turn risk into a strategic advantage and/or capital

Risk-tolerant: Accepting risk when necessary, but not seeking risk

Speculative risk: A risk that may result in loss, no change, or gain

​6th Part

​Strategic risks: Possible events and situations that can affect the execution of an organization’s long-term plans

Transference: A risk-response strategy that involves moving the impact of a risk to someone or something else

​Impact: The effect or influence of an event

Multiple Choice

The likelihood that an event will occur

• Operational risks

• Probability 

• Risk measurement

• Risk response

Multiple Choice

A risk-response strategy that involves moving the impact of a risk to someone or something else

• Accept

• Avoid

• Mitigation

• Transference

Multiple Choice

Specific guidelines and activities used when responding to undesirable circumstances; an alternative course of action

• Exchange rate

• Credit downgrade

• Contingency plan

• Chief risk officer (CRO)

Open Ended

Choose 10 vocabulary word and write a paragraph with them.

​Friday:Fishbone Diagram

​Access the template in Canvas, you may also use

​Monday: SWOT Analysis

​Use this Document in Canvas to complete todays Assignment.