Enterprise risk management in SMEs: Towards a structural model

Abstract

This article analyses enterprise risk management (ERM) in small and medium-sized enterprises (SMEs) by developing a structural model based on a survey questionnaire. Preconditions for ERM implementation, applied ERM approaches and their effects on strategic orientation are derived. The results suggest that SMEs follow either an active or a passive ERM approach, which affects their strategic orientation; a passive approach results in a defensive strategy and an active approach, an offensive strategy. Firm size, sector affiliation and ownership structure influence the implementation of ERM. The applied conceptualization of ERM may help SMEs adjust to a changing environment to gain strategic advantage thus, increasing competitiveness and business success.

Identifying Political Risk Management Strategies in International Construction Projects

“…As suggested by Malhotra, the cumulative variance of the produced components should be greater than 60.000%. To increase the correlation between strategies and components, the qualified strategies in each component should have a factor loading ≥0.500 [42]. e internal consistency of the components should satisfy two conditions: Cronbach's alpha of each component ≥0.700 [38] and the item-to-total correlation of each retained measure ≥0.400 [43].…”

Financial impediments in risk management mechanisms of Greek Small and Medium Enterprises

“…al., 2015). According to Brustbauer (2016) the application of the right risk management mechanism can help SMEs to adjust to a changing environment, in order to gain strategic advantage in the long run.…”

“…KEEE 7 ;TFGR 8 ;SETE 9 , 2014). 4 A nation can create a national competitive advantage if it will obtain the following: firm strategy, structure and rivalry, demand conditions, related and supported industries, factor conditions (Porter, 1990, cited in Karaoulanis, 2015b …”

Gender differences in risk management. Small and medium sized enterprise perspective (Różnice w zarządzaniu ryzykiem ze względu na płeć. Perspektywa małych i średnich przedsiębiorstw)

“…The issue of risk management in organizations, although extensively discussed on the international level [Beasley et al 2005;Brustbauer 2014;Chapman 2007;FERMA 2014;], is an insufficiently discussed and recognized area in Poland, particularly in economic practice [Gorzeń-Mitka 2007;Gorzeń-Mitka 2015]. World practice shows that risk management has now become an integral part of business activities undertaken by the company, builds value to the organization, shaping the effectiveness of undertaken actions [Hopkin 2010;Lam 2003].…”