Blog 2 – Risk management

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Risk Management in terms of future profitability of a business concern

-Dr. Radhika Wadhera

Risks can be different in nature i.e financial, operational, technical or related to Human Resource. All businesses and non-profit organizations face the risk unexpected events, such as a natural disaster, loss of funds through theft, or injury to staff, customers, or visitors on your premises, could impact operations. Any of these events can cost your organization money or cause your organization to permanently close. With a risk management plan, we can prepare for the unexpected, minimizing risks and extra costs before they happen. By considering potential risks or events before they happen and having a risk management plan in place, we can save money and protect your organization’s future. Purchasing the appropriate Insurance cover for business is an important part of your risk management plan, but it’s not enough by itself. One still must have policies and procedures in place to reduce risks to ensure your assets, reputation, financial security and operations can continue without interruption. Risk evaluation allows us to determine the significance of risks to the business and decide to accept the specific risk or take action to prevent or minimize it. Risk management involves putting processes, methods and tools in place to deal with the consequences of events you have identified as significant threats for your business. This could be something as simple as setting aside financial reserves to ease cash flow problems if they arise or ensuring effective computer backup and IT support procedures for dealing with a systems failure.

Programs which deal with threats identified during risk assessment are often referred to as business continuity plans. These set out what you should do if a certain event happens, for example, if a fire destroys your office. You can’t avoid all risk, but business continuity plans can minimize the disruption to your business.

Risk assessments will change as the business grows or as a result of internal or external changes. This means that the processes you have put in place to manage your business risks should be regularly reviewed. Such reviews will identify improvements to the processes and equally they can indicate when a process is no longer necessary.

Blog 1 – The Barter Way

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The Barter Way

– Vaibhav Mishra F.Y.MMS

Money. A key component to almost everything that we’re doing today. Be it typing, writing, selling, fighting, acting, thinking, doing a job, running a business, anything and everything has the same base, we do it for money. Because money can buy what we don’t have, it can provide us the ability to purchase things that we don’t posses. But imagine, what if there was no money in the economy? What if there was no common unit to measure the exact value of a commodity? Money is a very recent phenomena. It’s been around from roughly 4000 years. Humans have been living in communities and small societies for millions of years and during all this time they needed to exchange things, because they didn’t had everything that the needed. A person having a farm of wheat couldn’t grow high quality Apples in it because that only possible in cold regions. The person growing Apples couldn’t treat cold and fever because he didn’t knew how it was done. So, they were dependent on someone else for some goods and stuffs that they needed or for the specialization of some other person in things that they couldn’t do and of which they were in need of. But how would they do that if there was no medium of exchange? That’s how Barter system came into being. “I’ll give you what I have in exchange for what you have,” formed the basis of commerce. Now people who grew Apples could exchange them with people who grew Sugarcane, or anything for that matter. Now this system sounds good, but there were several loopholes. What if the person who produces Apples wants Rice but the person who produces Rice, doesn’t like Apples? How many Apples does the person need to give in order to get a kilogram of Rice? How does the quality of goods come into the equation? How do you determine which commodity gets how much of which commodity and why? All these loopholes led to the fall of this system of exchange which was replaced by a more reliable and simple one, money. Barter is effective, it’s still used today at many places for example- If India needed to import Onions from Australia, they can provide them with Mangoes of the equal value, but we need to admit that it can be done only for a limited range of things, it cannot form the basis of a complex economy.