Quantitative Approach to the Implementation of Risk Management in Romanian SMES

Abstract :

Small and Medium-sized Enterprises (SMEs) are essential for the growth of any economy, the advantages they offer consist of the contribution to the production of goods and services, the creation of jobs with relatively low capital, the reduction of income disparities, the formation of qualified and semi-skilled human resources and the reduction of poverty. Like any other organization, SMEs face many risks, but tend to reactively perceive risk management activities, greatly reducing the capacity of available resources to mitigate risks. By implementing a structured approach to risk management within the operations of SMEs, benefits such as reducing global risks, reducing costs, organizational alignment with the mission and objectives of SMEs can be achieved. The purpose of this paper is to identify if there is a significant correlation between perception of the possible benefits obtained from implementation of risk management and integration of risk management into current operations within Romanian SMEs. The data were collected from 164 owners, managers, risk managers, project managers of SMEs in Romania by applying a questionnaire and analyzed using Linear Regression at a significance level of 0.01. The results indicate that appreciating the importance of increasing profitability and revenues and identifying and controlling a greater number of risks at entity level, as potential benefits of implementing risk management, have a significant and negative contribution to the extent to which risk management is integrated into current operations of Romanian SMEs.?In contrast, there is a significant and positive association between the extent to which risk management practices are applied in the current operations of Romanian SMEs and the importance of aligning risk management with company objectives and increasing stakeholder satisfaction and involvement in risk management.