What are common steps in risk management?

What are common steps in risk management?

• A. Identifying, analyzing, prioritizing, planning responses, and monitoring.
• B. Hiring, training, evaluating, promoting.
• C. Marketing, selling, distributing, pricing.
• D. Budgeting, forecasting, auditing, reporting.

Answer: (A)

Risk management follows a cycle of actions that handle uncertainty by first spotting potential problems, then assessing how likely they are and how much impact they could have. Once you understand the severity of each risk, you prioritize which ones need attention, then plan appropriate responses to reduce or control those risks—through avoidance, mitigation, transfer, or acceptance. Finally, you continuously monitor risks and the effectiveness of your responses, updating plans as conditions change. The other activities correspond to different areas like people management, marketing operations, or financial control, rather than the ongoing process of identifying, assessing, prioritizing, responding to, and tracking risks.

Risk management follows a cycle of actions that handle uncertainty by first spotting potential problems, then assessing how likely they are and how much impact they could have. Once you understand the severity of each risk, you prioritize which ones need attention, then plan appropriate responses to reduce or control those risks—through avoidance, mitigation, transfer, or acceptance. Finally, you continuously monitor risks and the effectiveness of your responses, updating plans as conditions change. The other activities correspond to different areas like people management, marketing operations, or financial control, rather than the ongoing process of identifying, assessing, prioritizing, responding to, and tracking risks.