Critically evaluate the need for risk management in the event industry Essay

Critically evaluate the need for risk management in the event industry - Essay Example Risk management, as it relates to the event administration, may include action items such as fire evacuation procedures or it may be a minor problem from rowdy guests. Risk management, basically seeks to minimize the prospect of money or other forms of finance that can be utilized ineffectively or abused. It increases the profit margin for the company, by making sure that all resources are utilized safely, logically, and efficiently. Though, the actual process of risk management varies from company to company but in general, it requires support of owners, together with the management team, in order to filter the overall process and attain the lowest degree of risk possible. (What is risk management, 2003) As risk management is an integral part of any kind of business, it is also an essential component and a specific prerequisite for successful  event management. It combines many management disciplines, such as change management, knowledge management, strategy and leadership. Risk management can be considered as an informal decision making course that seeks to generate certainty from uncertainty.   The importance of risk management in the event industry has developed with the growing complexity and specialisation of service supply. Though, it does not prevent snow conditions from forcing event managers to cancel a festive marquee event, but not understanding and effective execution of useful risk management strategies can result in disastrous situations. Risk management, without any doubt, is significant part of the planning process. Analysing the risk, allows a firm to recognize the degree to which potential risks might impact the events. Risks can be measured in accordance to their possibility or likelihood of happening and they can also be considered in terms of the impacts of the risk or its consequences. Examining a risk and preparing risk matrices enable the managers to