How to Cite
Abstract
The research aims to explain and describe how HR involvement in risk management results in positive outcomes for an organization.
The paper follows a deductive structure by reviewing the current state of knowledge about the topic, selecting suitable theories and creating a model to be tested empirically. The theoretical approach revolves around the interconnectivity of the concepts of risk management, human resources management, decision-making processes and change management. The result of the analysis of specific theories is a model containing a risk management framework. The model is applied to check its validity and reliability in three different case studies. The first two cases contain qualitative analysis of secondary and tertiary data. The third case was built by gathering primary data through semis-structured interviews and participant observation. The data is analyzed using interpretative coding and the template application methods.
The empirical results show that the model is valid, meaning that the fundamental assumptions on which it was developed are reliable as well. The answer to the research question is that the involvement of people in the organization creates a strong culture. The risk culture is the most valuable competitive advantage that makes the important difference between bankruptcy and maintaining a leadership position.
References
Andersen, T.J. 2010a, "Combining central planning and decentralization to enhance effective risk management outcomes", Risk Management, vol. 12, no. 2, pp. 101-115.
Andersen, T.J. 2010b, Lehman Brothers (B) Case
Andersen, T.J. &Schrader, P.W. 2010, Strategic risk management practice: how to deal effectively with major corporate exposures, Cambridge University Press.
Appelbaum, S.H., Habashy, S., Malo, J. & Shafiq, H. 2012, "Back to the future: revisiting Kotter's 1996 change model", Journal of Management Development, vol. 31, no. 8, pp. 764-782
Buongiorno, G., Coleman, G., Hessel, G. & Murphy, W. 2005, "Lehman Brothers: Uniting Strategy and Business Culture", Chief Learning Officer, vol. 4, no. 4, pp. 54-54
Boudreau, J.W. & Ramstad, P.M. 2005, "Talent ship, talent segmentation, and sustainability: A new HR decision science paradigm for a new strategy definition", Human resource management, vol. 44, no. 2, pp. 129-136.
Bower, J.L. & Gilbert, C.G. 2007, "How Managers' Everyday Decisions Create or Destroy Your Company's Strategy", Harvard business review, vol. 85, no. 2, pp. 72-79
Bozeman, B. & Kingsley, G. 1998, "Risk culture in public and private organizations", Public administration review, vol. 58, no. 2, pp. 109-118
Carral&Kajanto, M. 2008, "Nokia: a case study in managing industry downturn", Journal of Business Strategy, vol. 29, no. 1, pp. 25-33
Cican S.I., 2014, “Comparative study between traditional and enterprise risk management – a theoretical approach”, Annals of The University Of Oradea, Economic Science Series, 23, 1, pp. 276282, Business Source Complete, EBSCOhost, viewed 12 May 2015
Collin, J. &Lorenzin, D. 2006, "Plan for supply chain agility at Nokia", Int Jnl Phys Dist& Log
Manage, vol. 36, no. 6, pp. 418-430
Damodaran, A. 2008. ‘Strategic Risk Management’, Chapter 11 in Strategic Risk Taking: A Framework of Risk Management, Wharton School Publishing, 341-365
Dillon, R.L. & Tinsley, C.H. 2008, "How Near-Misses Influence Decision Making Under Risk: A Missed Opportunity for Learning", Management Science, vol. 54, no. 8, pp. 1425-1440
Elahi, E. 2013, "Risk management: the next source of competitive advantage", Foresight, vol. 15, no. 2, pp. 117-131
Fischer, H. &Mittorp, K.D. 2002, "How Hr Measures Support Risk Management: the Deutsche
Bank Example", Human resource management, vol. 41, no. 4, pp. 477-490
Gasbarre, April D., David E. Salamie, and Jeffrey L. Covell. "Nokia Corporation." International
Directory of Company Histories. Ed. Jay P. Pederson. Vol. 77. Detroit: St. James Press, 2006. 308-313. Gale Virtual Reference Library. Web. 20 June 2015
Ghinea, V.M. (2011) Conducting the company. Human Resource Management course.
Bucharest: BREN Publications
Greenfield, H. 2009, "Culture Crash", Conference Board Review, vol. 46, no. 5, pp. 60-65
Johnson, M.A. & Mamun, A. 2012, "The failure of Lehman Brothers and its impact on other financial institutions", Applied Financial Economics, vol. 22, no. 5, pp. 375-385
Juergen, M. 2012, "Role models", Entrepreneur, vol. 40, no. 3, pp. 63-63
Kahneman, K. 2011, “Thinking, fast and slow”, Part II. Heuristics and Biases, Chapter 13.
Availability, Emotion, and Risk, Part IV. Choices, Chapter 31. Risk Policies, London: Allen Lane
Kotter, J.P. (1996), Leading Change, Harvard Business School Press, Boston, MA
Kotter, J.P. & Schlesinger, L.A. 2008, "Choosing Strategies for Change", Harvard business review, vol. 86, no. 7, pp. 130-139
Kugler, T., Connolly, T. &Ordóñez, L.D. 2012, "Emotion, Decision, and Risk: Betting on
Gambles versus Betting on People", Journal of Behavioral Decision Making, vol. 25, no. 2, pp. 123-134 Lambert, Susan J. "Passing the buck: labor flexibility practices that transfer risk onto hourly workers." Human Relations 61.9 (2008): 1203-1227.Business Insights: Essentials. Web. 5 June 2015
Lazzerini, B. &Pistolesi, F. 2013, "Profiling risk sensibility through association rules", Expert Systems with Applications, vol. 40, no. 5, pp. 1484-1490
Levasseur, R.E. 2001, "People Skills:Change Management Tools--Lewin's Change Model", Interfaces, vol. 31, no. 4, pp. 71
March, J.G. & Shapira, Z. 1987, "Managerial Perspectives on Risk and Risk Taking", Management Science, vol. 33, no. 11, pp. 1404-1418
Martinez, E. A., Beaulieu N., Gibbons R., Pronovost P., and Wang T., 2015. "Organizational
Culture and Performance." American Economic Review, 105(5): 331-35
Merriam-Webster.com: “risk” 2015. Retrieved May 01, 2015, from http://www.merriamwebster.com/dictionary/risk
Meyer, M., Roodt, G. & Robbins, M. 2011, "Human resources risk management: Governing people risks for improved performance", South African Journal of Human Resource Management, vol. 9, no. 1, pp. 310-321.
Mintzberg, H. 1987, "The Strategy Concept I: Five Ps For Strategy", California management review, vol. 30, no. 1, pp. 11-24
Mueller, C 2004, ‘Conceptualization, Operationalization, and Measurement’, in Michael S.
Lewis-Beck, A Bryman, & Tim Futing Liao (eds), Sage Publications, Inc., Thousand Oaks, CA, pp. 162-
, viewed 6 May 2015, doi: http://dx.doi.org/10.4135/9781412950589.n150
Paul, C. &Mitlacher, L. 2008, "Expanding risk management systems: human resources and
German banks", Strategic Change, vol. 17, no. 1, pp. 21-33
Pfeffer, J. 2010, Building Sustainable Organizations: The Human Factor, Academy of Management
Reyna, V.F. 2004, "How People Make Decisions That Involve Risk: A Dual-Processes
Approach", Current Directions in Psychological Science, vol. 13, no. 2, pp. 60-66
Rundmo, T. 1996, "Associations between risk perception and safety", Safety Science, vol. 24, no. 3, pp. 197-209
Sharma P. ,Chrisman J.J., 1999, "Toward a Reconciliation of the Definitional Issues in the Field of Corporate Entrepreneurship", Entrepreneurship: Theory & Practice, vol. 23, no. 3, pp. 11-27
Servaes, H., Tamayo, A. &Tufano, P. 2009, "The Theory and Practice of Corporate Risk Management", Journal of Applied Corporate Finance, vol. 21, no. 4, pp. 60-78
Tayeb, M. 2004, International Human Resource Management : A Multinational Companies Perspective, Oxford University Press, UK, Oxford, GBR. Chapter 1: Introduction: Why study interntional HRM?
Van Praag, C. M. and Cramer, J. S. (2001), The Roots of Entrepreneurship and Labour Demand: Individual Ability and Low Risk Aversion. Economica, 68: 45–62. doi: 10.1111/1468-0335.00232
Vaughan, D. 2005. ‘System Effects: On Slippery Slopes, Repeating Negative Patterns, and
Learning From Mistake?’, Chapter 3 in Starbuck, W. H. and Farjoun, M. (eds.), Organization at the Limit: Lessons from the Columbia Disaster, Blackwell Publishing, Malden, MA, pp. 41-59
Weick, K. E. and Sutcliffe, K. M. 2001. ‘What Business can Learn from High Reliability Organizations’, Chapter 1 in Managing the Unexpected, Jossey-Bass, San Francisco, pp. 1-23.
Wilson D., "risk." The Blackwell Encyclopedia of Management. Cooper, Cary L. Blackwell Publishing, .Blackwell Reference Online. 12 May 2015 http://www.blackwellreference.com.escweb.lib.cbs.dk /subscriber/tocnode.html?id=g9780631233176_chunk_g978140511828625_ss7-1
COSO Enterprise Risk Management - Integrated Framework, Retrieved May 01, 2015, from http://www.coso.org/documents/COSO_ERM_ExecutiveSummary.pdf
IRM - Risk Management Standard, Retrieved May 01, 2015, from
https://www.theirm.org/media/886059/ARMS_2002_IRM.pdf
ISO 31000:2009 Risk management — Principles and guidelines, Retrieved May 01, 2015, from https://www.iso.org/obp/ui/#iso:std:iso:31000:ed-1:v1:en
"Investment Banking." Market Share Reporter: Trends Over Time. Ed. Monique D. Magee, Miranda H. Ferrara, and Michele P. LaMeau. Detroit: Gale, 2012. 353-368. Gale Virtual Reference Library. Web. 16 June 2015
"Nokia: big and clever", 2007, Strategic Direction, vol. 23, no. 7, pp. 14-16
"When the chain breaks." The Economist 17 June 2006: 19(US). Business Insights: Essentials.
Web. 20 June 2015
Lehman Brothers Annual Report 2006
Lehman Brothers Annual Report 2007
Nokia Annual Report 2000, Insight: Business review
Navne&NumreErhvervMarkedsdata, Retrieved June 20, 2015, from http://erhverv.nnmarkedsdata.dk.esc-web.lib.cbs.dk/Content/Search/CommonSearch.aspx Service organization website, Retrieved 20 June 2015
This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.
Copyright (c) 2025 ANURADHA YADAV (Author)