Introduction to Risk Management - Vocabulary Flashcards

Vocabulary flashcards covering key risk management concepts from the lecture notes.

Risk management

A broad, systematic process that combines risk identification, risk analysis, and risk evaluation to manage threats and opportunities.

Risk

Potential for negative outcomes from uncertain events, assessed by likelihood and impact.

Risk identification

Groundwork of risk management: listing risks that could affect objectives.

Risk analysis

Evaluates each risk’s likelihood and impact, considers controls, and assesses residual risk.

Risk evaluation

Compares analyzed risks against predefined criteria (e.g., risk tolerance) to set priorities and actions.

Integrated risk management

Risk management that is part of every level and function—embedded in governance, decision-making, and daily operations.

Structured and comprehensive

Applying a consistent, systematic approach to ensure clear, efficient, and repeatable risk practices.

Customized

Tailoring risk management to the organization’s specific needs and context.

Inclusive

Involving relevant stakeholders (employees, customers, partners) for diverse perspectives and buy-in.

Dynamic

Risk management that is adaptive to changing internal and external conditions.

Best available information

Using current, reliable data to inform risk management decisions.

Stakeholders

Individuals or groups with an interest or involvement in risk management (e.g., employees, customers, partners).

Human and cultural factors

People’s behaviors, norms, and culture that influence how risks are perceived and managed.

Continual improvement

Ongoing refinement of risk management through reviews, lessons learned, and feedback.

Compliance risk

Risks arising from government-mandated licenses, permits, and regulatory requirements.

Hazard risk

Risks that can cause physical loss or damage (e.g., fire, typhoon, flood, earthquake, injury).

General/Business risk

Risks that create uncertainty about achieving goals and objectives.

Opportunity risk

Risks that are deliberately embraced or pursued to enable future long-term success.

Reputation and assets protection

Safeguarding an organization’s reputation and tangible assets by proactive risk identification and mitigation.

Loss minimization

Strategies to reduce potential financial losses by anticipating and mitigating threats.

Innovation and growth through risk-taking

Encouraging pursuit of new opportunities by effectively managing risks.

Regulatory compliance

Adherence to applicable laws and regulations to avoid penalties and ensure continuity.

Personal growth

Development gained from taking calculated risks in personal life (e.g., career changes).

Resilience

The ability to cope with challenges and adapt to adversity by navigating risks.

ISO 31000

An international standard outlining principles and guidelines for risk management.

COSO ERM

The Enterprise Risk Management framework by the Committee of Sponsoring Organizations, guiding risk management.

Cybersecurity and data breaches

Risks from cyber threats and data breaches in hospitality and related sectors.

Economic pressures and cost escalation

Rising costs and economic slowdowns affecting business viability.

Business interruption and natural disasters

Operational downtime caused by events like disasters, affecting continuity.

Workforce shortages

Insufficient staff leading to higher costs and reduced service levels.

Reputation damage

Harm to brand value from negative reviews, crises, or poor service.

Evolving customer expectations

Changing demands and preferences requiring ongoing adaptation.

Overtourism and environmental strain

Overcrowding and sustainability challenges impacting destinations.

Geopolitical instability and shifting travel patterns

Political events altering travel flows and market opportunities.

Biodiversity loss

Decline in biodiversity affecting destination appeal and regulatory risk.

Multidimensional risk management

An approach integrating resilience, sustainability, technology governance, and agile operations.

Resilience planning

Planning for continuity and rapid recovery in the face of disruptions.

Sustainability

Long-term balance of economic, environmental, and social factors in risk management.

Technology governance

Oversight of technology use and associated risks within an organization.

Agile operational strategies

Flexible, responsive operations that can quickly adapt to changing risk conditions.

Avoidance

Eliminating risk by ceasing activities that may expose the organization to danger.

Diversification

Spreading risk across different operations or investments to balance outcomes.

Transfer

Shifting risk to third parties (e.g., insurers) through contracts or financial instruments, with potential counterparty risk.

Retention

Accepting and internally managing risk when transfer is costly or risk is tolerable.

Loss control

Limiting potential damage by setting thresholds and triggering actions when risks materialize.

Risk identification, analysis, evaluation

Process of listing risks, assessing likelihood/impact, and comparing to criteria to prioritize actions.

Risk response options

Choices to avoid, reduce, share (transfer), or accept risks as part of risk management.