Table of ContentsIntroductionMethodologySmall and Medium BusinessesRisk ManagementRequirements of Risk Management in SMEsRisk ConceptsRisk in SMEsTeam Management and KnowledgeCostTechnologyCustomerInterest IncrementManage riskIdentifying riskAssessing and analyzing riskControlling and monitoring RiskConclusionIn a rapidly changing world, risk management must be carried out effectively and quickly. Risk management involves analyzing, understanding and managing risks so that businesses can achieve their objectives and goals. Risk management processes must be understood to minimize and reduce risks. The aim of this article is to provide a systematic literature review of previous evidence on risk management in (SMEs). The research results showed that the risk can be divided into two groups which can then be managed with the plan. This is the first article that critically analyzes risk management in small and medium-sized businesses. Furthermore, the consequences were due to the lack of information on the methodologies used by small businesses. Additionally, further studies are needed to compare the different techniques used to manage risks and their effects on the organization. Say no to plagiarism. Get a tailor-made essay on “Why Violent Video Games Should Not Be Banned”? Get the original essayTags: Business, Management, Project, Risk, Small and Medium EnterprisesIntroductionRisk management is a key aspect of a business, due to the fact that risk management will allow certain actions to be carried out when risk is present . Risk management includes 5 processes which are considered as risk identification, risk analysis, risk assessment, risk treatment, and finally risk monitoring and review. The purpose of this review is to carry out a research study that will help small and medium-sized businesses with risk management and planning. The literature process will proceed by describing the problem and purpose of the research being carried out. Next, the methodology performed will be explained with a clear analytical structure that is used to carry out certain aspects of the examination. Data collection and research will be applied to the literature review which will conclude the main body of the paper. A discussion of the results will be provided and finally, a conclusion and summary will be drawn from the key areas. Methodology The procedure whose methodology was carried out includes risk causality, risk management, risk control and techniques that can be used to minimize and reduce risks in a small and medium enterprise (SME). To be able to carry out the research, a literature review was used using the University of Wolverhampton website (Library Search) to gather sources of information such as: Books, journals and articles relating to risk. The aim and objective of this document is to be able to analyze and reduce potential risks in small and medium-sized businesses.Small and Medium-sized EnterprisesSmall and medium-sized enterprises (SMEs) are comprised of independent businesses that employ less than a specified number . employees. This number varies depending on the country, because in the European Union there is a frequent limit for an SME which is 250 employees. On the other hand, some countries have set their limits at 200 employees, while the United States envisages SME companies having less than 500 employees. Risk Management The main characteristic of risk management isthat it focuses on identifying and assessing risks by managing these risks in order to have a reduced impact on the project. However, there is no such thing as a risk-free project as there are countless projects that can have a negative impact on the project. There have been many studies on risk management carried out by Tzvi Raz, Aaron J. Shenhar, and Dov Dvir (2002) in various different industries. The results they gathered regarding risk management practices include: Risk management is not used in various projects. The projects most likely to have a risk management plan were those that were perceived to be high risk. The use of risk management assisted in completion. many successful projectsA risk management approach improved project schedules, costs and objectives which influenced project quality. Sufficient time spent on risk management increases a project's chances of success. Grant et al state that risk management is used to help project managers anticipate delays that cause project delivery delays. Risk management is carried out to define various objectives, improve project control, increase the chances of project success, and improve communication among project participants. Risk management requirements in SMEs According to Steve Giles, small and medium-sized enterprises (SMEs) are impervious to modern approaches. However, some companies will consider loss prevention methods, while many will not implement a formal risk management process. Many organizations tend to interpret it as an unnecessary task that costs time and money without adding value. Additionally, failure of risk management techniques can sometimes leave SMEs vulnerable. A recent study indicates that 50% of SMEs close their doors before the end of the fifth year due to an unprecedented period of uncertainty. Using risk management enables better decisions and helps prevent losses. Concepts of Risk Kerzner describes risk as the lack of knowledge about future events. This definition can be applied to derive characteristics common to all risks whose outcome is uncertain. However, the comparison of interpretations of the definition can be divided into two simple groups. The first group of definitions assigns the negative side of risk when it is considered a threat. Therefore, Vochozka and Mula recognize risk as the fear of potential tangible and intangible environmental effects of achieving goals. According to Fort and Hnilica, interpret as risk any possible negative deviation from the set objectives. Similarly, Smejkal and Rais understand risk as the situation in which an unfavorable deviation from desired outcomes occurs. The second group includes risks focused on potential opportunities. This can serve as a guide to making improvements by checking or reducing certain risk factors. As noted above, the most successful projects involve implementing a structured risk management process. However, taking risks as an opportunity will help to have a positive impact on the project. Risk in SMEs Management and knowledge of teams With reference to Gilmore et al., 40 interviews were carried out by the authors and it is implied that the majority businesses are exposed to risk. loss of knowledge when qualified employees with high-level intelligence and knowledge leave the company. Therefore, this concludes that it isof high risk for SMEs because, based on long-term and qualified staff, many of them will not share the same level of knowledge. Gao et al. found case study results that imply that risk management knowledge may be mostly informal in SMEs, making it more difficult to create risk management scale with respect to members of the PME team. CostAccording to Moore et al., a large number of SMEs are looking for methods in which costs can be reduced with respect to materials. The authors highlighted the volatility of commodity prices in recent years. Additionally, there is an increase in market competition and an increase in raw material prices. Moore et al. explained that a variety of large companies have invested in advanced technologies and can thereforeThey easily understand that when prices rise, they can be transferred to cheaper resources. On the other hand, many small and medium-sized businesses are not able to pay for this type of investments and that is why they are exposed to cost risk.TechnologyA research work was carried out, including 15 qualitative interviews and a survey based on 125 small and medium-sized businesses in the UK, which demonstrated that the highest risk was considered to be online security. Sukumar et al. The risks mainly relate to online issues, including cyberattacks, false identities and credit card fraud. Technological risk refers to the installation of computer systems and the type of security applied to them. Poba-Nzaou et al. showed that software can represent a significant risk for SMEs because its implementation requires greater resources than those of large organizations. Customer Regarding customer risk, the managers of small and medium-sized businesses interviewed in the study carried out by Sukumar et al. justified that consumer trust is one of the most important risks associated with a business located online. The authors' argument indicates that it is very difficult for managers to regain trust due to the fact that it is a company of limited size and the number of transactions. It has been implied that many breaches in online security can have a significant impact on customer trust and organizational reputation. This concludes the reason for customer risk which is difficult to rebuild after a security incident. Increase in interest. The studies by Altman et al. indicate that in some occasions SMEs depend on external financing, this involves loans to represent a source of financing. . However, the risk is rising interest rates. Regarding banks, Mutezo says SMEs can potentially reduce banks' fears by paying attention to information and asymmetries. Understanding the SME perspective, Bruns and Fletcher conducted a study showing that SMEs that had a weak financial position but a high risk probability were mostly rejected compared to companies with a strong position. Additionally, Bruns and Fletcher believe that being able to have a stronger financing position can potentially offset high risk. They also found that SMEs that had limited collateral were less likely to get a loan despite taking on a risk, while organizations that had high collateral were more likely to have their loans approved despite low risk. . of riskThe first step of the.