Risk Management Process

This might mean completely stopping activity in a business unit

• Accept the risk.

• Avoid the risk.

• Mitigate the risk.

• Transfer the risk

When managing the risk might prove more costly than it is worth., the decision is to

• Accept the risk.

• Avoid the risk.

• Mitigate the risk.

• Transfer the risk

When The investors/owners desire exposure to a risk factor, the decision is to

• Accept the risk.

• Avoid the risk.

• Mitigate the risk.

• Transfer the risk

If a business risk is not a natural part of normal business operation,, the decision is to

• Accept the risk.

• Avoid the risk.

• Mitigate the risk.

• Transfer the risk

When the risk is perceived to have a small impact on the firm, the decision is to

• Accept the risk.

• Avoid the risk.

• Mitigate the risk.

• Transfer the risk

Businesses that choose to retain risks may seek ways to strategically

• Accept the risk.

• Avoid the risk.

• Mitigate the risk.

• Transfer the risk

Manufacturers might rise labor costs by investing in automation to

• Accept the risk.

• Avoid the risk.

• Mitigate the risk.

• Transfer the risk

Because the cost can be priced into the firm’s products and passed along to customers, the decision is to

• Accept the risk.

• Avoid the risk.

• Mitigate the risk.

• Transfer the risk

This option can be costly because it involves a third party

• Accept the risk.

• Avoid the risk.

• Mitigate the risk.

• Transfer the risk

It introduces a counterparty risk

• Accept the risk.

• Avoid the risk.

• Mitigate the risk.

• Transfer the risk