Historical Development Matrix - Assignment Example

Historical Development Matrix The historical development of risk management can be traced back to the early innovations of the pre-twentieth century era. Risk management and quality improvement has been around for quite a long time and it encompasses initiatives of prevention, correction and education. This paper develops a historical development matrix by identifying ten historical events tat are related to risk management and quality improvement. Keywords: risk management, quality, events Historical Development Matrix Historical Development (Name, Year) Founder of Event Nature of Development Importance to Development of Risk Management and Quality Improvement Transfer of risks to third parties Third and second millennia BC Chinese and Babylonian Traders Transferring or distribution of risks through redistributing wares across many vessels to limit loss that can be caused as a result of single vessels capsizing (Crouhy, Galai, & Mark, 2001).

Introduced the idea of managing risks through distributing risks across a large number of parties to minimize loss. It also introduced a form of naval insurance. Hammurabi laws insurance, 1750 BC Babylonians Codes of Hammurabi form of insurance. This form of risk management introduced the idea of insurance in which a third party had their merchant vessels covered by loans funds and would be refunded in case their ships were stolen. Technological risks created through invention of stem powered engines, the late 1700s.

US Congress Appearance of the high-pressure steam engines led to death of more than two thousand five hundred people (Hopkin, 2010). This led to a call for the establishment of higher standards of safety. It led to the implementation of high health standards in technology as means of risk management through reducing chances of risks turning into hazards. Industrial revolution of the 1800s Industrial revolution Transformation of the nature of hazards and risks leading to bigger dangerous agents like bridges, oil tankers, airplanes among others.

Establishment of the Delany clause in the United States which regulated cosmetics, food and the drug industries among others which upheld human and animal life (Kaveler, & Spiegel, 2003). 1960s and 1970s Insurance agencies Insurance companies sought to reduce their potential for loss through encouraging firms to make their premises much safer. This marked the first age and step of risk management where business shifted their focus from insurance companies to cover their risks. They also considered non-entrepreneurial risks such as security.

Companies used risk reactively to see how much insurance they ought to buy. 1970s to 1980s British Standards Institution (BSI) Business started to introduce quality insurance as a way of ensuring that their products conformed to their specifications. Marked the introduction of quality standards as companies started taking risks in a more proactive or preventive manner 1995 Standards Australia Publication of World’s Risk Management Standards. These standards led to the reporting of risks in financial accounts and further reviews of company law and other regulations that demanded extensive reporting of risks.

Early 2000s Corporate scandals such as Enron Corporate scandals leading to financial losses. Establishments of legislations around the world that defined new standards for reporting company accounts with an effort to ensure honest and transparent reports. 2001 and 2002 Japan and UK Risk management standards. Formal definition of risk management and the introduction of the continuous improvement or kaizen (McNeil, Frey, & Embrechts, 2005). References Crouhy, M., Galai, D., & Mark, R. (2001). Risk mangment.

New York, NY: McGraw-Hill. Hopkin, P. (2010). Fundamentals of risk management: understanding, evaluating and implementing risk management. Philadelphia, PA: Kogan Page. Kaveler, F., & Spiegel, A. D. (2003). Risk management in health care institutions: A strategic approach. Mississauga, ON: Jones and Bartlett Publishers. McNeil, A. J., Frey, R., & Embrechts, P. (2005). Quantitative risk management: Concepts, techniques and tools. Princeton, NJ: Princeton UP.