An organization can face various types of risk that prevent the growth and development of the organizations. According to originated area, the risk can be divided as operational risk, financial risk, market risk and strategic risk. The operational risk comprised with the operational related hazards. The financial risk implies the monetary losses and insufficient financial resources of the organization . The market risk associated with the reputation, brand image and brand value of the organization. The strategic risk arises from the failure of the strategic action.
The risk can be categorized by the nature of the risk such as the hazards or the real threats, control risk and opportunity or speculative risk . The hazards are the real risks associated with the business activities of the organization, which are permanent risks. The examples of hazards are the operational risk, performance risk, financial risk, etc. Moreover, for these types of risks, the companies use to deploy various risk management techniques to minimize the risks. Control risks are management risk, which can also be minimized by appropriate measurements .
In addition to this, the opportunity or speculative risks are the uncertain risks, which can arise from the natural calamity, massive technical failure from the political instability and from the downfall of the financial market. The companies have to be prepared for the opportunity risks, and appropriate risks measurement can support in reducing the effect of these risks .