Behavioral risk involves the identification, analysis, and management of risk factors in industrial and organizational psychology. Its management regards the process of managing workplace risk factors pertinent to organizational behavior and industrial and organizational psychology. "Behavioral risk management applies to risks connected with the workplace behaviors of employees and organizations that have a negative impact on the productivity of an organization; behavioral healthcare episodes and the cost of treating these episodes; and lifestyle behaviors that lead to preventable healthcare conditions and the cost of treating these conditions."
Its focus lies on how behavior affects workplaces and organizations along with how to appropriately mitigate negative effects from inappropriate behavior.
The management of behavioral risk encompass the study of organization and individual behavior from two primary roots: risk management and organizational behavior. With regard to its risk management roots, this type of management analyzes the effect of practices, cultures and behaviors as well as their associated risk of negative outcomes within an individual (health) and/or an organization (expenses). Alternatively, from its organization studies roots, behavioral risk management explains how organizations and their respective organizational culture, productivity and success of a firm can be associated with the given organization's behavioral aspects.
Behavioral risk is studied to "identify and prevent loss from behavioral risk factors, thereby enhancing organizational health and human capital". Ultimately, the purpose of behavioral risk management is to identify practices and patterns that prove detrimental to organizations. The main applications of this study were identified as:
Cost savings from preventable loss
Increased productivity and profitability by addressing human capital needs
Enhanced strategic alignment with human resources and organizational leadership
Measure and demonstrate successes in human capital management
Negative behavior (or "discreet emotions") within an organization can lead individuals to feel uncomfortable as well as stressed.
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