Risk management technology in the public sector: challenges and opportunities

Abstract

The paper examines the importance of using effective risk management methods in the public sector, emphasizing the need for an integrated approach to this problem. The author emphasizes that public management mechanisms must be supported by appropriate technologies to ensure sustainable functioning. The use of ISO 31000 and ISSAI 9100 standards helps structure the risk management process and increase its effectiveness. Risk management should be based on the identification, assessment and response to risks and take into account the influence of various factors on the risk management process. The author also notes that risk management in the public sector is complicated by certain factors (frequent management changes, division of operating budgets and programs, lack of clear risk indicators, etc.). The analysis of the issue demonstrates that the system of assessment, management and risk reduction should play a key role in public administration. The main task of risk management as an element of public management is to make effective decisions, create the necessary conditions and plan actions taking risks into account to minimize their negative impact on planned results. As a result of the use of risk management technologies, it is possible to identify risks, determine factors and sources of risk, assess the degree and probability of occurrence of hazards and, ultimately, develop an optimal plan of management actions. The results of the study demonstrate that the issue of forming a risk management mechanism in the public sector requires further scientific research on the application of theoretical developments in the practical activities of public management and administration bodies of Ukraine. The paper also focuses on the issue of risk management in public sector organizations, and concludes that in order to assess the value, type and impact of risk, it is necessary to review the internal part of the organization and its management processes, as well as its environment. Such a review of risks should be complemented by increased risk awareness at each level of the management hierarchy and in the day-to-day activities of all employees of the organization. Thus, the need to use modern risk management technologies in the public sector is outlined in order to increase the effectiveness of the decisions made and minimize the negative impact of potential risks on the results of the work of management bodies.