Interpretive Structural Modeling Approach to Analyze the Interaction Among Key Factors of Risk Management Process in SMEs: Polish Experience
Many drivers are shaping the risk management processes in enterprise. Understanding the interrelationships between individual risk drivers is a significantly important for decision making processes. This is a complex challenge especially for SMEs enterprises. This paper aims to identify the most important risk factors and determine the interactions of these factors in risk management process in small and medium firms based on Polish SMEs experience. This study is based on the technique Interpretive Structural Modelling (ISM), in order to delineate a flowchart that shows the main risk factors (and their relationships) influencing the risk management processes in small and medium enterprises. Through a process of modelling it was possible to reach a graphical presentation that shows the operating sequence of main risk factors in order to understand the logic of their relationship. The final model is a useful tool that can be adopted to optimize decision making process in SMEs from risk perspective.
Keywords: enterprise risk management, interpretive structural modeling (ISM ), risk factors, SMEs