COMPONENTS OF RISK MANAGEMENT
Effective risk management is composed of four basic components: framing the risk,
assessing the risk, responding to the risk, and monitoring the risk. Each component is
interrelated and lines of communication go between them. The output from one component
becomes the input to another component. Risk management is a process that
must be ingrained across the entire organization, involving information system
owners, developers, engineers, and administrators at the tactical level; mid-level
planners and managers at the business unit level; and the organization’s most senior
leaders, who view risk at the strategic level as it impacts the entire organization. The
leaders define the environment in which risk-based decisions are made and set the
risk management process on a framework by developing a risk management strategy.