Identification of Business Management Risk Chain Based on ISM - MICMAC Model

Abstract

The selection of risk factors influencing business management in enterprises and the analysis of their hierarchical relationships are of great theoretical value and practical significance to the sound operation of enterprises and the steady development of the industry. In this study, 11 factors influencing the risk chain of business management in enterprises are sorted out through literature analysis and expert interviews. The hierarchical relationships and distribution of categories of these factors are analyzed based on Interpretative Structural Model (ISM) and Matrix Impacts Cross-reference Multiplication Applied to a Classification (MICMAC). The results of the study show that these factors can be divided into four tiers and three types. The direct factors with strong dependency are Vision and Goals, Operation, Company Culture, Internal Control, and Performance Management. The indirect factors are Risk Awareness, Efficient Communication, Policy Orientation, Market Competition, and Economic Environment, the first two of which have a strong drive and dependency on the whole system, while the last three of which have a strong drive but relatively low dependency. The deep factor with low dependency and a strong drive is Industrial Technology. The results of the study have universality and can provide guiding ideas for the improvement of business management in enterprises.