RISK MANAGEMENT in HR

 

Figure1: Risk Management – Source (Fiero, 2018)

 In the present world of work, organizations are facing many real-time challenges and difficulties in an unstable business environment. The impact of ‘Risk’ has multiplied and essential characteristics should establish to overcome these threats.

Risk management of Human resources keeps weight enough to overcome these challenges in this critical era in advance.

 

WHAT IS RISK MANAGEMENT IN HR?

 Identifying the potential threats and challenges that arise due to the employee base which directly impacts the business, taking relevant measurements, building up regulators and policies, Updating them and developing are the main tasks of risk management in HR.

 

FIELDS OF RISK IN HR (HR Education Network, 2020)

·       Hiring employees-Vigilant process must be implemented to avoid discrimination while hiring. Discouraging recruitment or hiring based on gender, race, age, or disability is considered an illegal allocation.

·        Compensation and Benefits-Employee involvement in illegal activities are considered a key component of risk in the working environment. Embezzlement is Popular in financial institutions where money and sensitive financial data are handled. This effect on compensation and benefits.

·        Health and Safty-Ensuring a secure and healthy working environment. Organizations become an adverse place to work due to circumstances' effects on the physical and mental health of employees.

·        Employee conduct and Supervision-Employees with less competency, less knowledge of company rules and regulations, lack of awareness of the workflow, Less concern to keep sensitive data safe and infirm practices of teamwork can increase the risk of an organization.

·        Exiting employees-Employees who quit the job with a reasonable service, are aware of the sensitive information of the organization. Exposing this knowledge can arise the risk with harmful effects.

 

PROTOCOLS TO REDUCE RISK IN HR

•       Awareness of the management while hiring and recruiting employees.

•       Arranging duel control, Password security systems, Multiple signature requirements in important documents.

•       Conducting safety training sessions, Awareness programs to take necessary health measurements and provide a secure and pleasant work environment.

•       Training and developments sessions to educate employees regarding their job role, teamwork and security.

•       Mitigating the exiting of employees by fulfilling their basic requirements and encouraging long-term retention.

 

INTEGRATED RISK MANAGEMENT SYSTEM

Developing tools for analyzing personnel risks, considering applied aspects of the management, this integrated system can be implemented considering employees competency, abilities and infirmities. (Nevmerzhitskaya, 2021)

                                                                     Figure 2: Risk management and success- Source  (WATKINS, 2020)

 “HR risk management could be the key to keeping your employees happy and growing your business. When you focus on managing risks around hiring, management, compliance, and employee growth, you set your business up for success.” (WATKINS, 2020)

Conclusion

As a banker in a state bank of Sri Lanka, I realize that the risk ratio is in a high manner where banks deal with sensitive financial information and critical stages of the Economy. This directly impacts with employee base so risk management in HR can heavily support the above.

References

Fiero, T. (2018) HR MANAGEMENT & COMPLIANCE. [Online]
Available at: https://hrdailyadvisor.blr.com/2018/05/10/hey-hr-taking-risk-management-seriously/
[Accessed 20 nov 2021].

HR Education Network (2020) How HR Professionals Play A Role In Risk Management. [Online]
Available from https://www.hreducationnetwork.com/2020/09/28/how-hr-professionals-play-a-role-in-risk-management/
[Accessed 19 nov 2021].

Nevmerzhitskaya, O. (2021) Integrated HR Risk Management System. SHS Web of Conferences 110, Volume 110.

WATKINS, H. (2020) The Complete Guide to HR Risk Management Every Manager Needs. [Online]
Available at: https://solvoglobal.com/hr-risk-management/
[Accessed 20 nov 2021].

 


Comments

  1. KAMAL C. DIVITOTAWELANovember 20, 2021 at 7:26 AM

    Its a useful article ,Risk management is the task of minimising threats or potential problems that may arise in a project or workplace. Many HR departments develop risk management plans that are regularly updated to keep up with company policies as technology continues to evolve.

    ReplyDelete
  2. Sanjaya BandaranayakeNovember 20, 2021 at 7:19 PM

    Good article. It is very important to minimize employees related risks before they arise in a organisation. If employers ensures all employees are satisfied in a organisation, that will protect the business against possible issues. Which is on the other hand very difficult task for human resources.

    ReplyDelete
  3. Buddhika JayarathnaNovember 21, 2021 at 6:03 PM

    A human resource risk management professional helps manage a business's risks by evaluating how a situation could affect a company's employees, such as their performance, Thanks to share

    ReplyDelete
  4. Sujeewa RupasingheNovember 21, 2021 at 7:28 PM

    This comment has been removed by the author.

    ReplyDelete
  5. Sujeewa RupasingheNovember 21, 2021 at 7:43 PM

    Proactively working on minimizing risk associated with employee relates will facilitates a stable organization. in such environments the impact of sudden loss will have limited impact. Good article.

    ReplyDelete
  6. Nuwansiri RathnayakeNovember 24, 2021 at 9:33 AM

    Valuable article. It's really important o identify the risk and well managed in the firm. this is a key point that decide the employee performance and the future of the organization. useful article and good explanation.

    ReplyDelete
  7. Thushara WattegedaraNovember 28, 2021 at 1:54 AM

    Really impressive topic and adds huge value to the HR function. Will be more attractive if you can add something related to the Covid19 pandemic situation and it is really helpful because that was something no one expected and add to risk but now is the time to think of that part too. Very good article. Thank you for sharing.

    ReplyDelete
  8. Asitha DNovember 30, 2021 at 5:13 AM

    There are number of risks that come across management of HR. It is important to manage these risks when hiring employees, providing compensation and benefits, providing health and safety facilities for employees and managing employees at workplace in order to improve the performances of employees through effective HRM.

    ReplyDelete
  9. Steffni_DDecember 5, 2021 at 7:41 PM

    HR risk management should be a critical component of any company, regardless of size or industry. A effective HR risk management plan may help you cope with difficult workers, make better hiring decisions, and better manage people throughout your company (Watkins, 2020)

    ReplyDelete
  10. Sandya December 15, 2021 at 9:33 AM

    Including human resources in risk management highlights the importance of people in achieving farm objectives. Most manufacturing, financial, and marketing choices are influenced by human resources.

    ReplyDelete
  11. Imashi DayaratnaDecember 16, 2021 at 8:24 AM

    It also provide greater stability to financial systems and alternative funding sources for borrowers.

    ReplyDelete
  12. Tharaka Pathirana December 17, 2021 at 6:38 PM

    Supervision by corporate management from recruitment to long-term retention of employees reduces employee risk management. This should be done continuously by the organization.

    ReplyDelete
  13. E127918December 19, 2021 at 5:28 AM

    Risk management is a continuous process. That is, it is a continual activity rather than something that can be crossed off a "to do" list. A risk management approach ensures that the company is aware of and understands the dangers to which it is exposed. It also means the company has carefully assessed the risks and devised plans to eliminate the risk entirely, lower the possibility of the risk occurring, or limit the harm if it does occur.

    ReplyDelete

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