Title : Inherent risks in the education sector
link : Inherent risks in the education sector
Inherent risks in the education sector
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What is risk? In simple terms, risk can be interpreted as the impact of uncertainty on objectives. This concerns the consequences, threats, dangers, and so forth. Risks can occur to anyone, including businesses in any industrial sector. One of them is the education industry.
However, in Indonesia itself it is still rare for educational institutions such as tertiary institutions to explicitly implement risk management in its management. In fact, policies in higher education are no less important than monetary and fiscal policies. In addition, to understand and carry out correct risk management, quality human resources are needed.
Some of the risks that can occur in the education sector include the following.
1 Business model risk
This risk requires the institution to generate adequate income. This has an impact on the sustainability and relevance of the university business model. Both in the delivery of education and income. Institutions that do not implement this will certainly be unable to compete with other educational institutions.
2 Reputation risk
Building the reputation of an educational institution is very important to attract the interest of knowledge seekers. Institutions with reputation awareness and control over attendance to alumni and business relations are certainly able to reduce the risk of damaging the reputation that has been built up over the years.
3 Operating model risk
This risk can be caused by inadequate processes, human resources and systems. So that it affects the ability of institutions to function efficiently and effectively. Operational agility is important so that the institution remains competitive, flexible, and relevant as business strategies and models shift. The university operating model includes delivering academic programs, conducting research, making decisions, and maintaining accreditation status.
4 Financial risk
Educational institutions that depend on tuition fees cannot maintain a healthy financial condition if there is no strong and consistent student registration. This can also limit an institution's ability to manage resources and infrastructure needs to support the learning process.
5 Compliance risk
Educational institutions such as tertiary institutions including governance bodies must continue to comply with state regulations, regional regulations, and the growing private sector. Failure to meet compliance standards can lead to consequences such as loss of accreditation and loss of funds, even lawsuits.
6 Cyber risk
At present, cyber risk is not only the priority of financial institutions and defense institutions, but is not limited to other industries including educational institutions. This is because there is a growing dependence on data, technology and interrelationships in collecting, storing and processing data.
When the education sector continues to develop rapidly new risks will also emerge. Educational institutions must be prepared and aware that they will not be able to overcome all risks without it risk management well. Insurance can be an effective way to reduce the risk of financial loss resulting from the risks mentioned above.
Purchase type insurance for educational institutions right, effective and in accordance with risk can be owned through insurance brokerage services such as Marsh Indonesia specializing in risk in the education industry who can provide services ranging from risk identification to providing insurance package solutions. Thus, educational institutions will be protected from various risks that may occur.
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