The role of interactive style of use in improving risk management effectiveness

Marc, Mojca (author), Arena, Marika (author), Peljhan, Darja (author)

The purpose of this paper is to investigate how to make risk management systems (RMS) more effective. We identify a critical element for effective RMS, which is neglected in the literature, and argue that the potential of advanced RMS designs (e.g., enterprise risk management—ERM) depends on the interactive style of use. However, interactive use is costly in terms of managers’ time and attention, so many organizations do not use RMS in this way. Using survey data and PLS-SEM, we show for our sample companies that the positive effects of advanced RMS design on effectiveness are fully mediated through interactive use of RMS. This brings on an important implication that a RMS leads to better results when it is used interactively. For example, more interactive use of less developed RMS design (such as the traditional silo-based design) would improve its effectiveness by compensating for the lack of an organization-wide RMS.

• Language: English
• Keywords: management, risk, risk managemant, enterprise risk management, ERM, risk management system, interactive use, risk management efectiveness, PLS-SEM
• Work type: Article
• Typology: 1.01 - Original Scientific Article
• Organization: EF - School of Economics and Business
• Publication status: Published
• Publication version: Version of Record
• Year: 2023
• Number of pages: 21 str.
• Numbering: Vol. 25, iss. 2, art. 9
• PID: 20.500.12556/RUL-147564
• UDC: 005.3
• ISSN on article: 1460-3799
• DOI: 10.1057/s41283-023-00114-4
• COBISS.SI-ID: 141728515
• Publication date in RUL: 07.07.2023

Record is a part of a journal

• Title: Risk management
• Shortened title: Risk manag.
• Publisher: Springer Nature
• ISSN: 1460-3799
• COBISS.SI-ID: 514966297

Licences

• License: CC BY 4.0, Creative Commons Attribution 4.0 International
• Link: http://creativecommons.org/licenses/by/4.0/
• Description: This is the standard Creative Commons license that gives others maximum freedom to do what they want with the work as long as they credit the author.

Secondary language

• Language: Slovenian
• Keywords: management, tveganje, obvladovanje tveganj

Projects

• Funder: ARRS - Slovenian Research Agency
• Project number: P5-0364
• Name: Vpliv upravljanja, organizacijskega učenja in managementa znanja ter inovacij na organizacije v starajočih se družbah