International Journal of Application or Innovation in Engineering & Management (IJAIEM)

Web Site: www.ijaiem.org Email: editor@ijaiem.org, editorijaiem@gmail.com Volume 1, Issue 2, October 2012 ISSN 2319 - 4847

Risk Management and Its Impact on Productivity in Industrial Units for Wardha District - A Strategic Management Centered Approach
Rohit R. Manjule1, Dr. Mohan S. Jagnade2
1 T&P officer and Assistant Professor, DESs College of Engineering and Technology, Dhamangaon Rly(MS), India

HOD of Department of Commerce, G. W. Arts & Commerce College, Nagbhid.

ABSTRACT
Awareness of the Risk Management is low in the Industries and calls for efforts to integrate in the operations of the industrial unit. Risk Management through a Strategic Management centered approach improves the Productivity and creates immense value for the organization. Risk Management has to be an essential part of Strategic Management of an organization in running the Industrial unit safely and efficiently in light of the emerging global business scenario. One of the important factors in terms of optimizing the operation is the way value at risk involved in the task is handled. Thus, it becomes important to have a proper risk management strategy in place to tackle the value at risk in an industrial unit. The aim of the research is to delve into the level of risk management exercise undertaken and to study the imperatives thereon. Further, the study would involve understanding the problem confronted while implementing and to identify the areas of improvement. Given the experience & association with the industries in this belt, the researcher has familiarity & access to these units. Since the researcher has background to support risk management activities, industries would be eager to know the benefits, hence are likely to cooperate in their own interest.

Keyword: - Risk Management, Industrial Growth, optimization, Faculty, Employee.

1. INTRODUCTION
Risk management [1,2,3] is an integrated process of describing specific areas of risk, developing a comprehensive plan, integrating the plan and conducting ongoing evaluation. A process identifies loss exposures faced by an organization and selects the most appropriate techniques including insurance for treating such exposures. Risk management is broader concept and includes all techniques for treating loss exposures, At its most general level, risk is used to describe any situation where there is un curtaining about what outcome will occur[2] . Risk may be objective or subjective. Objective Risk is defined as the relative variation of actual loss from expected loss. Subjective Risk is defined as uncertainly based on a persons mental condition or state of mind. In most of the risky situations, two elements are commonly found: 1. The outcome is uncertain i.e. there is a possibility that one or other(s) may occur. Therefore, logically, there are at least two possible outcomes for a given situation. 2. Out of the possible outcomes, one is unfavorable or not liked by the individual or the analyst. The future is largely unknown. Most business decision-making takes place on the basic of expectations about the future. Making a decision on the basis of assumptions, expectations, estimates and forecasts of future events involves taking risks[3]. Risk has been described as the sugar and salt of life. This implies that risk can have an upside as well downside. People take risk in order to achieve some goal they would otherwise not have reached without taking that risk. On the other hand, risk can mean that some danger or loss may be involved in carrying out an activity and therefore, care has to be taken to avoid that loss[5]. This is where Risk Management is important, in that it can be used to protect against loss or danger arising from a risky activity[6]. The risk management process involves the following logical steps:

Volume 1, Issue 2, October 2012

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International Journal of Application or Innovation in Engineering & Management (IJAIEM)

Web Site: www.ijaiem.org Email: editor@ijaiem.org, editorijaiem@gmail.com Volume 1, Issue 2, October 2012 ISSN 2319 - 4847
1. 2. 3. 4. 5. Defining the objectives of the risk management exercise. Identifying the risk exposures Evaluating the exposures Critical analysis of risk management alternatives and selecting one of them Implementation and review

Figure 1: Flow of Risk Management Process In our paper, here we are describing Risk management and its impact on productivity in Industry Wardha and other area in Maharashtra Region in India.

2. METHODOLOGY
2.1 Studies about the Area Wardha Wardha district is located on the north-eastern side of Maharashtra state in India. As per the 2001 Census, the population of the Wardha district is 12,36,736. The male population is 638990 where as women population is 597776. Population of the district is increased by 15.87 percent in the 10 years span of 1991 to 2001. From the total population, 20.40 percent population is of the urban area and 73.60 is of the rural area. The population of the urban and rural areas are 3,25,041 and 9,11,695 respectively. 2.2 Research Methodology for implementing Risk Management 2.2.1 Primary data collection The primary data collection in view of the objectives of the study involved preparation of research instrument (interview schedule). Though development and measurement of research constructs is neither simple nor straightforward, instrumentation techniques are available that allows us to construct research instruments that constitute acceptable levels of reliability and validity. 2.2.2 Interview Schedule Development Interview schedules are typically used for feedback research to determine the current status or "situation," or to estimate the distribution of characteristics in an industrial population. Much of interview schedule construction is common sense, but there are intricacies with which survey authors should be familiar. It is common sense to require that the concepts be clearly defined and questions unambiguously phrased; otherwise, the resulting data are apt to be seriously misleading. To overcome this problem, 2.2.3 Question types Based on the objectives, questions/statements were framed such that each statement would yield Single response. 2.2.4 Reliability Estimation Reliability is a measure of how consistent the results of using a survey questionnaire will be. By consistent we mean that respondents understand the true meaning of the question as it is stated. Reliability was determined using a "pilot test" with the proposed survey interview schedule 2.2.5 Final Selection of Items and Development of Instrument A reliable measurement of the perception of senior officials working in industrial units for risk management strategies, their awareness of the rules and regulations set by the statutory bodies, etc. is usually a difficult task; yet, it is obviously a necessary precursor to understand the various issues of importance of risk management in industrial units.

3. RESULT AND DISCUSSION

Wardha district on the statement, which states that documentation of managements attitude on risk management for the benefit of all staff. It was evident that 60.4% (29) officials were strongly agree with the statement which states that

Volume 1, Issue 2, October 2012

Page 165

International Journal of Application or Innovation in Engineering & Management (IJAIEM)

Web Site: www.ijaiem.org Email: editor@ijaiem.org, editorijaiem@gmail.com Volume 1, Issue 2, October 2012 ISSN 2319 - 4847
documentation of managements attitude on risk management for the benefit of all staff, 25% (12) officials were agreed with the statement, whereas 10.4% (5) officials were neutral with the statement. Table 1: Documentation of managements attitude on risk management for the benefit of all staff Frequency Percent Cumulative Percent Strongly Disagree Disagree Neutral Agree Strongly Agree Total 1 1 5 12 29 48 2.1 2.1 10.4 25.0 60.4 100.0 2.1 4.2 14.6 39.6 100.0

Table 2 : Person responsible for risk management in organization Person Responsible Frequency Percent Cumulative percent The Chief Executive Officer Another senior executive Head of Finance A committee The Risk Manager The Internal Auditor Other Total 2 6 22 14 4 48 4.2 12.5 45.8 29.2 8.3 100.0 4.2 4.2 16.7 62.5 91.7 100.0

4. CONCLUSION
Risk management strategy has become an important, rather integral part of corporate strategy in recent years. Though there have been some practices followed in the pas in a minor scale. Another area the is contributing to lack of awareness is that , in most of the unit risk management professionals are not employed. Thus relaying mostly in the insurance agent. Agent can provide the insurance services but may not be able to counsel the unit on risk management. With liberalization of insurance sector in India, brokers can play an important role in not vital with risk management. It may be concluded from the study results that Private sector risk management practitioners/consultants have significantly less important role in development and implementation of risk management within the organizations in Wardha district.

REFERENCE
[1] S.E. Harrinton and G.R. Michaus, Risk Management and Insurance, McGraw-Hill, 1999, P.3. [2] Emmett J Vaughan, Risk Management, John Wiley & Sons, Inc., 1997, P.8 [3] Wilson, I., Strategic Planning Isnt Dead-It Changed, Long-range Planning, August, 1994, P.20 (Reproduced in Hunger and Wheelen, Op.cit., P.4) [4] Hollman KW., Forrest JE., "Risk Management in a Service Business", International Journal of Service Industry Management, 1991; 2(2):49 65 [5] Alexander K, "Facilities Risk Management", Facilities, 1992;10(4):14 18. [6] White D., "Application of systems thinking to risk management:: a review of the literature", Management Decision, 1995; 33(10):35 45 [7] Egbuji A, "Risk management of organizational records", Records Management Journal, 1999; 9(2): 93 116 AUTHOR
Rohit R. Manjule, is working as a training & placement officer & assistant professor in DESS College of engineering & technology, Dhamangaon rly, India. He has obtained his B.E.(Mining) & M.B.A.(Marketing) degree from RTM Nagpur University, India. He is having 6 years of corporate Industry experience & 4 years of academic experience. He has published various papers in International Journal & conference. He is active member of Training & placement officers society, Nagpur. His research is mainly focused on Risk Management & its impact on productivity.

Volume 1, Issue 2, October 2012

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International Journal of Application or Innovation in Engineering & Management (IJAIEM)

Web Site: www.ijaiem.org Email: editor@ijaiem.org, editorijaiem@gmail.com Volume 1, Issue 2, October 2012 ISSN 2319 - 4847
Dr. Mohan S. Jagnade is a Chairman of board of studies, Commerce department, Gondwana University, Gadchiroli. He is also HOD of department of commerce, G.W. Arts & Commerce College, Nagbhid. He received his doctorate degree in Commerce from Nagpur University. He is having total 26 years of teaching experience. He is a faculty member of board of studies, Commerce department of Nagpur University. He has published various papers in international journal & conferences. His research is mainly focused on Risk management.

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