Organization in Types of Risk:
Risk refers to sudden unplanned events which cause major disturbances in the organization and trigger a feeling of fear and threat amongst the employees.
Organization in Types of Risk; Following are the types of Risk:
- Natural Risk
- Disturbances in the environment and nature lead to natural Risk.
- Such events are generally beyond the control of human beings.
- Tornadoes, Earthquakes, Hurricanes, Landslides, Tsunamis, Flood, Drought all result in natural disaster.
- Technological Risk
- Technological Risk arises as a result of the failure in technology. Problems in the overall systems lead to technological Risk.
- Breakdown of machine, corrupted software and so on give rise to technological Risk.
- Confrontation Risk
- Confrontation crises arise when employees fight amongst themselves. Individuals do not agree with each other and eventually depend on non-productive acts like boycotts, strikes for indefinite periods and so on.
- In such a type of Risk, employees disobey superiors; give them ultimatums and force them to accept their demands.
- Internal disputes, ineffective communication and lack of coordination give rise to confrontation Risk.
- Risk of Malevolence
- Organizations face Risk of malevolence when some notorious employees take the help of criminal activities and extreme steps to fulfill their demands.
- Acts like kidnapping company’s officials, false rumors all lead to Risk of malevolence.
- Risk of Organizational Misdeeds
- Crises of organizational misdeeds arise when management takes certain decisions knowing the harmful consequences of the same towards the stakeholders and external parties.
- In such cases, superiors ignore the after effects of strategies and implement the same for quick results.
Organization in Types of Risk; A risk of organizational misdeeds can be further classified into following three types:
- Risk of Skewed Management Values
- A risk of Skewed Management Values arises when management supports short-term growth and ignores broader issues.
- Risk of Deception
- Organizations face Risk of deception when management purposely tampers data and information.
- Management makes fake promises and wrong commitments to the customers. Communicating wrong information about the organization and products lead to Risk of deception.
- Risk of Management Misconduct
- Organizations face Risk of management misconduct when management indulges in deliberate acts of illegality like accepting bribes, passing on confidential information and so on.
- Risk due to Workplace Violence
- Such a type of Risk arises when employees are indulged in violent acts such as beating employees, superiors in the office premises itself.
- Risk Due to Rumor’s
- Spreading false rumors about the organization and brand lead to Risk. Employees must not spread anything which would tarnish the image of their organization.
- Bankruptcy
- A Risk also arises when organizations fail to pay its creditors and other parties.
- Lack of fund leads to Risk.
- Risk Due to Natural Factors
- Disturbances in environment and nature such as hurricanes, volcanoes, storms, flood; droughts, earthquakes etc. result in Risk.
- Sudden Risk
- As the name suggests, such situations arise all of a sudden and on an extremely short notice.
- Managers do not get warning signals and such a situation is in most cases beyond any one’s control.
- Smoldering Risk
- Neglecting minor issues, in the beginning, lead to smoldering Risk later.
- Managers often can foresee Risk but they should not ignore the same and wait for someone else to take action.
- Warn the employees immediately to avoid such a situation.
Note: “Reading simple notes Organization in Types of Risk, also know about Risk Management and Risk Management Model“