Explain the purpose of "risk management." Answer: The purpose of risk management is to maintain control and minimize the risk of failure of product, service or process by using risk abatement plans.

The correct answer is A. Bottom line results. Option A is correct because risk management exists to protect an organization's financial outcomes - the "bottom line" (net profit/loss). By identifying and mitigating risks before failures occur, organizations avoid costly disruptions, liability, and losses that directly impact

Control Phase

Question

Explain the purpose of "risk management." Answer:

The purpose of risk management is to maintain control and minimize the risk of failure of product, service or process by using risk abatement plans.

Options

ABottom line results
BMarket share growth
CDefect reductions
DCustomer focus

How the community answered

(18 responses)

A
89% (16)
C
6% (1)
D
6% (1)

Explanation

Option A is correct because risk management exists to protect an organization's financial outcomes - the "bottom line" (net profit/loss). By identifying and mitigating risks before failures occur, organizations avoid costly disruptions, liability, and losses that directly impact profitability.

Why the distractors are wrong:

B (Market share growth) is a sales/marketing objective driven by competitive strategy, not risk control.
C (Defect reductions) is the primary goal of quality management processes like Six Sigma, not risk management specifically.
D (Customer focus) is a broad organizational philosophy (think TQM), not the defining purpose of risk management.

Memory tip: Picture risk management as a financial safety net - everything it does (abatement plans, controls, failure prevention) ultimately catches problems before they hit the bottom line. When in doubt, follow the money.

Topics

#risk management#risk abatement#process control#failure prevention

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