The Management of Risk to Corporate Facilities and Inventory

Author

John D. Campbell, Fontbonne College

Year of Award

1993

Degree

Master of Business Administration (MBA)

College

College of Business & Professional Studies

Degree Program

Business Administration

Department

Business Administration

Keywords

risk, loss, insurance, fire, catastrophe, property

Abstract

The facilities utilized for the day-to-day operations of a corporation are vital. The necessary machinery to produce the products are located within the manufacturing facility. The offices of any corporation are where decisions affecting the company's direction, operation, and competitive posture are made. Storage is required of both the finished product and the raw materials utilized in its manufacture. Distribution facilities are required for shipping.

These facilities must be protected from the risks to which they are exposed. Risks can range from the employees themselves to uncontrollable natural forces. Identification of risks that can result in a financial setback, or loss, to the corporation is necessary in achieving protection. Risk management is the process whereby those risks are recognized, evaluated, and protected against. Risk management analyzes the required means to recoup losses that occur as a result of risks.

Insurance can provide the necessary financing to help the corporation recoup its losses and is a valuable tool for a risk manager. Insurance aids the risk manager in determining the acceptable level of risk that a corporation can face. Insurance, in some form, has been around for centuries to protect businesses from risks. Insurance premiums are determined from the level of risk that is to be protected against.

A corporation's risk management department assists the organization in reducing the cost of these premiums through effective loss prevention programs. The risk management department can help the. organization increase its profit potential.

The thesis will present the benefits of corporate risk management with respect to property and product loss prevention through a brief history of risk management and its relationship to insurance, identification and measurement of risks, the pros and cons of contracting out risk management services, and the impact risk management has on corporate cash flows and profits.

Document Type

Restricted Thesis

Recommended Citation

Campbell, John D., "The Management of Risk to Corporate Facilities and Inventory" (1993). All Theses, Dissertations, and Capstone Projects. 262.
https://griffinshare.fontbonne.edu/all-etds/262