System Dynamics Approach for Organizational Risk Management

Abstract

Risk Management Strategy provides an overview of the processes directed at reducing risk and capturing opportunities. It outlines processes and techniques to enhance the efficiency of risk management. Managing risk is an integral part of sound management, and fundamental to achieving programme objectives. A formalized, well-structured and systematic approach to risk management is essential to ensuring the continuing success of the programmes and the achievement of the programme objectives. Better management of risk and more successful activities are the expected outcomes. In this sense, this paper examines the concept of risk, the objective and policy of risk management, the strategy and the generic procedure. Also as a case study, the Risk Management Strategy of Tax Concession Program in Australian Federal Government is analysed with System Dynamics perspective.