How Do Businesses Manage Risk?

In the modern world of business, risk is present in almost all forms of activity. For example, in factories and industry, workers need to be protected against injury when the workplace when vehicles, such as forklift trucks, are in operation. A factory will look to minimize the risks of such accidents by creating “forklift zones” that exclude the general workforce from certain parts of the workplace where loading and lifting take place. In an office environment, the risks may differ considerably but still need to be managed. The threats posed by cybercrime are modern risks that need to be protected against in any business that operates online. A successful cyber attack can cost a business millions of dollars and the loss of business reputation. As such, it is a risk that must be fully considered and protected against. In this article, three ways in which a range of businesses manage the risks that they are exposed to will be considered.

Secure API Gateways

Today, many businesses will use application programming interfaces as part of their IT infrastructure. These systems allow communication between two or more separate applications and are vital in tasks such as maintaining company websites or running servers. Businesses will commonly install an api gateway that controls the flow of traffic in these systems by providing a single point of access. This access point would be a focal point of any cyber attacks, so the gateway systems will be protected with authentication and monitoring protocols. Securing API gateways is a vital way in which companies that use high-level tech can protect themselves from the risks posed by cybercrime. It is also likely that IT professionals will constantly monitor API gateways and will configure custom reports from the traffic in this part of the IT infrastructure to assure that they are operating effectively and without malicious traffic.

Risk Registers

Risk registers are used extensively in business in both high-tech companies and those that do not use technology extensively. In essence, they are a comprehensive list of the risks that a company faces in its daily operation. Risk registers may include information on the expected severity of a risk if it were to occur (i.e., what damage would it cause to the company) and the likelihood of that risk occurring. Together, the perceived likelihood and severity ratings of risk can be calculated on a risk matrix to give a score. The higher the score, the greater the risk to the company. Risks should be reviewed by senior management regularly and new risks should be added to the register when they become known.

Incident Reporting Systems

Every medium and large sized firm will likely use an incident reporting system to help them identify and manage risks whilst using the information to improve workplace safety. Staff should be encouraged to report any adverse incident or “near miss” at work so that the organization can build a comprehensive picture of the risks it faces. Incident reporting systems typically store the data from reports on a database. This can then be used to generate reports for management and senior staff to give an overview of the accidents and incidents that have occurred in the workplace in a given period.