Source document: https://docs-lawep.s3.us-east-2.amazonaws.com/1697749409933.pdf (Georgia)
IN A MODERN BUSINESS STRUCTURE, A RISK MANAGEMENT SERVICE IS PREFERRED Goderdzi Shanidze Doctor of Business and Management, Associate Professor, Kutaisi University; Akaki Tsereteli State University, Georgia goderdzi.shanidze@unik.edu.ge KEYWORDS: Risk-management; Crisis; Business; Diversification; Anti-risk measures; J.E.L.
classification: G32, L1, L21 Annotation Modern tendencies show that it is desirable for If we could identify a business risk in advance and companies to have a risk management service whose solve it easily, business would probably lose its main function will be to identify the expected risks, evaluate charm.

Risk is one of the essential components of and offer anti-risk measures to managers.

It is such business.

companies that will show fewer losses from crisis.


Only proper identification of risks, their measurement - evaluation and selection of an effective method of reduction are not enough to Introduction improve risk management; It is necessary to develop Knowledge of business management in crisi is an optimal organizational structure, develop an a very actual in modern conditions.

This was better organizational culture and properly manage the risk revealed by the "Covid-19" pandemic.
Numerous management control process.

In developed countries, companies suffered losses and had to suspend business almost all large and medium-sized organizations activities, dismiss employees, and so on.

have a special link in the management system.


"Risk The companies that had the risk management Management Center", (Corporate governance) which service assessed the business environment, the helps accountable entities assess risks, develop and scale of the pandemic in a timely manner and made implement manipulation measures.

decisions to implement risk-taking actions, they came The researches have proved that in some cases it is out of crisis situations with fewer losses.
It is true still strange to the Georgian business reality to take that the crisis for the business due to the pandemic measures to evaluate risks and ways of their solution, continues, but the effective services in the business which in some cases raises problems that lead to structures and primarily the risk management service crucial results.
Bankruptcy of foreign enterprises is is doing everything possible to align their business not strange for the Georgian market, because in most activities with state restrictions so that the company cases they are unprepared to take risks and fail to suffered fewer losses.

take measures to solve them.

Possible risks should be identified at an early stage of business formation to avoid unintended consequences.
109 trjyjvbrehb ghjabkb7 1@_7 @_@_2Economic Profile, N20, 2020 Main Part The information reduces the uncertainty of the risk Risk is an accompanying process of any activity or and allows us to set risk management measures in case decision.

Business risk is an interesting phenomenon, of timely delivery.

But, in order to play this important because if we simply express the link between role the information must be valuable.
business and risk, we can formulate it in such a way I would like to focus on a few of them for risk that the higher the risk, the greater the chance of profit management: is.

Also It should be noted that a complete definition Avoidance.

It can be said that avoiding risks at of risks is almost impossible.
first sight is directly related to information, because It should be noted that after taking risky measures when we have timely and correct information we can you are better, at least more experienced than ever, avoid some risk.

It is possible to use several types of because when we make a risky decision if it is justified avoidance: it gives us more motivation in life, and the ambition to - Refraining from conducting entrepreneurial achieve more in business.
But if the opposite happens (financial) transactions when decision-makers believe then it is a great experience in business that even large that the risk associated with these operations is too companies are learning from.

No matter what experience is gained in the business, no matter how large a particular business is, there is great.

- - Refusal to use large amounts of loan capital.


Refusal to use excessive amounts of current always a risk, but where there is a risk, there are also assets in low liquid form.

measures and means to solve or reduce it.

This is the - Refusal to apply for short-term financial issue of risk management I would like to focus on in investments of temporarily free cash assets.

this work.

- Completely refuse the services of unreliable When we start talking about risk management, it partners.
should be noted that this process is one of the most - Refusal of innovation and other projects. ''

important components of risk management planning.

(Chaganava, 2013:188) Every decision made by an entrepreneur is actually -Reservation.

The method of risk reduction is related to risk, for example when launching a new reservation (self-insurance).

Reservation means that product, selecting staff, and so on.
Each of these an entrepreneur creates a kind of fund from working decisions is a kind of risk, no one knows whether they capital, where funds are raised that are used to will meet the expectations of the entrepreneur, so it is eliminate unforeseen risks.

Reservation allows us to important to use important methods of risk reduction handle operations that: or taking measures in the business.
There are many risk-solving measures in a market - - Risks not covered by insurance; Acceptable and critical level risks with low economy: Avoidance, reservation, diversification, probability of occurrence; insurance and more.

Each method is used depending - Most of the financial levels of acceptable on the scale and nature of the risk.

level, the expected loss of which is not high.

Information is one of the most important Diversification.
Diversification is based on risk components in the risk management process, timely sharing.

information is incomparable in a market economy.

- It is used to manage investment risks.

For example, 110 if you have 100 thousand GEL to invest, there are two ways; trjyjvbrehb ghjabkb7 1@_7 @_@_2Economic Profile, N20, 2020 1.

To finance the loan of this volume fully; for small and medium-sized businesses to realize this 2.

To finance 10 different loans.

fact and ensure risks.
In this regard, we can talk about It should be noted that in terms of risk reduction, banks that provide consumer life insurance when business experts agree that the diversification method issuing a bank loan or installment, and thus insure the is preferred; because if we imagine a situation where risk of losing their finances, and the consumer accepts the first case cannot be refunded, we will lose the the given offer, as this enables the family to maintain given amount in full, but in the second case we stability in case of his death.
somehow have a defense mechanism and the chance The insurance implementation process is interesting of returning is correspondingly high.

in that it is based on significant observations and There are many forms of entrepreneurial risk calculations; For example, let’s consider travel diversification, from which are distinguished: insurance.

The insurance company analyzes how 1.

Diversification of activities many customers needed to use the given insurance 2.

3.
3.

Investment diversification product and can approximate the amount of money it Securities portfolio diversification will need to cover its insurance liabilities, otherwise 4. Credit portfolio diversification the insurance companies themselves will face 5.

Currency basket diversification financial risks.

6.

Deposit portfolio diversification; (Chaganava, We are not going to argue now that the company 2013: 208) should necessarily have a risk management service, Insurance.
"Insurance is one of the financial we just emphasize that in the recent pandemic instruments of risk management, through which "Covid-19", really many companies have suffered it is possible to avoid the financial loss caused by and faced problems for various unforeseen reasons.

the risk."

This is the moment when the insurance However, those companies that have assessed the company pays for the loss caused by the risk.
expected risks in a timely manner and have developed Insurance usually provides for the neutralization of appropriate anti-risk measures come out of the current high-risk transactions.

Insurance is a special kind of situation with fewer losses.

risk reduction.

It is characterized by redistributive According to the BIA (BIA-Business Information relationships.
It is easy to imagine that an insurance Agency), more than 700 companies have suspended fund is formed by insurance contributions, from operations since March 1, 2020, and 1,600 companies which the loss is refunded in case of risk.

Nobody have temporarily suspended operations.


According to knows whether a specific fact will actually happen the sector analysis, 23% of the suspended companies or we pay the insurance premium today to avoid a are in the field of "construction products, construction possible big loss in the future.

It is true that the basics and real estate", while 21% of the companies in the of risk insurance have existed since ancient times, but category of food products have stopped working.
it has gained special popularity in a market economy.

According to the regions, most companies stopped Georgian companies are also slowly realizing working in Tbilisi (63%), followed by Adjara (12%) the importance of insurance and getting involved in and Imereti (8%).

(Makalatia, 2020) this process.

Georgian insurance companies offer In general, we can conclude that the choice of risk different types of insurance.
The Georgian economy reduction methods depends on the level of risk of is still developing, so there are risks of financial instability, inflation and other risks, so it is important 111 trjyjvbrehb ghjabkb7 1@_7 @_@_2Economic Profile, N20, 2020 potential losses –that is why it is necessary for the of business activities without risk is unimaginable, entrepreneur to identify the minimum, allowable, especially for a country with an unstable economy critical and catastrophic levels of integrated risk.
such as Georgia.

As a result of development, the range of risks Effective risk management is relatively more connected with entrepreneurial and investment developed in joint ventures that have the opportunity activities is gradually increasing.

especially in the last to use the experience of foreign founders or partners.
10-15 years, risk management has become a significant Nevertheless, the risk management system in large problem for both financial market participants as and joint ventures is fragmented, episodic and limited.

well as companies and government organizations.


In conclusion, it can be said that there are several The reason for this is not the bankruptcy of various methods of resolving the risks posed to the company companies and banks, or public finance crises (they and the responsibility for its proper selection is up to have occurred before), but their scale, frequency of the manager.

It is desirable for companies to have a occurrence and speed of spread.
risk management service and their function will be to It is desirable to create a risk management service identify, assess and offer anticipated risks to managers in companies with the following composition: for implementation.
Practice shows that companies Information-Analytical Department (Risk Assessment that have a risk management service often come out and Prospective Development Divisions); Planning of crisis situations with fewer losses than those that do and Risk Management Department (Preventive not have such services.

Measures Departments); The Risk Control and Monitoring Department, etc., the Risk Management References: Service should be directly subordinated to the First 1.

Chaganava P., (2013) Risk Management.


Tbilisi, Manager.

Conclusion "Universali" 2.

Lazviashvili.

N. (2010) Risk Management.

Tbilisi.

The variety of problem-solving ways we have 3.

Chaganava.P.

(2009) Price-setting mechanism discussed, due to the specifics of our business allows in the negotiation process and management of related us to use each of them as well as combined methods risks”.

Batumi.

to solve the problem in practice, its choice depends on 4.
Baldin K., Varabiov S. (2005) Risk Management.

the manager's experience, risk-taking skills, degree of Moskow; risk-taking and other factors.

5.

Makalatia I., (2020) URL: https://bm.ge/ It should also be noted that insurance is a relatively ka/article/gasuli-kviris-top-10-ekonomikuri- well-known and applicable method for Georgian movlena/68240/) (Georgian Business Media businesses in the process of resolving business risk.

20.11.2020) (available: 28.11.2020).


That is why insurance companies try to refine their product and offer it to consumers in the desired way.

It should be noted that risk insurance is a vital process for all types of businesses, because the existence 112 trjyjvbrehb ghjabkb7 1@_7 @_@_2Economic Profile, N20, 2020