How to manage risks?

Preventable risks:These are internal risks, arising from within the organization, that are controllable and ought to be eliminated or avoided.
Examples are the risks from employees’ and managers’ unauthorized, illegal, unethical, incorrect, or inappropriate actions and the risks from breakdowns in routine operational processes Strategy risks: Strategy risks are quite different from preventable risks because they are not inherently undesirable.
A strategy with high expected returns generally requires the company to take on significant risks.Strategy risks cannot be managed through a rules-based control model.
Instead, you need a risk-management system designed to reduce the probability that the assumed risks actually materialize and to improve the company’s ability to manage or contain the risk events should they occur.
Such a system would not stop companies from undertaking risky ventures; to the contrary, it would enable companies to take on higher-risk, higher-reward ventures than could competitors with less effective risk management.
External risks: Some risks arise from events outside the company and are beyond its influence or control.
Sources of these risks include natural and political disasters and major macroeconomic shifts.
External risks require yet another approach.
Because companies cannot prevent such events from occurring, their management must focus on identification (they tend to be obvious in hindsight) and mitigation of their impact.
http://hbr.org/2012/06/managing-risks-a-new-framework/ar/

Risk from an investment point of view means the chance that the actual return on investment can vary than the expected return on that investment.
Normally risk and return are directly proportional to each other.
But a higher degree of risk means the probability of losses is also higher.
Thus proper risk management is very important for a business to survive in the long run.
 For a company which does credit sales normally face some or most of the following risks: a) Risk of Non-payment - This risk can be mitigated by conducting due diligence and proper credit evaluation of the potential customer.
b) Time value of money - Measures have to be taken so that the dues are collected promptly otherwise you will be actually financing the customer with your money with no extra cost to them.
c) Economic Conditions - This has to be considered as the economic and market conditions may impact the capability of a customer to pay.
E.g.
IT sector is always dynamic and products can become obsolete within a very short period.
This can have a negative impact on the payment capacity of a customer from IT sector.
d) Legal Changes - The changes in the legal framework of a country can have a negative or positive impact on a customer's capacity to pay.
So the organisation has to be up to date about all the legal changes so that it can be proactive and reduce risk of non - payment by customers.
After considering the above factors and if the organisation follows a well-defined credit policy and procedure, it will be able to manage and mitigate the risks associated with dealing with its Debtors.
 

First thing to understand how to manage risks you need to understand the nature of there impact. If we are to consider hazard risks those can be treated in one of four main methodologies ( THE4 T'S) ...If we are facing a highly likely risk with high impact then risk TERMINATE is the option. While dealing with high impacting low likelihood should be through risk TRANSFER (sharing). third option is to TREAT risks using in house resources that's in case you want to control high likely low impact risk. fourth treatment option is to TOLERATE and that's only when the risk falls within the organizational risk appetite and is with low impact and low liklihood of occurance

  The process of identifying, measuring and control and reduce the risks faced by the company or organization.

Any risk of losses that accompanies profit opportunities is seldom found to find someone's loss useful for someone else.