176 Posts Found

The future of risk management lies in an ability to incorporate and inspire more of the behaviors we want, finding new models to map, monitor, intervene, support, and react to the behaviors of individuals and groups—both the behaviors we want to encourage and those we’d like to avoid. Critically, this taking account of behavior means that we need a much sharper comprehensive strategy for corporate … [ Read more ]

Content: Quotation | Source: Business Finance Magazine | Subjects: Culture, Risk Management

Complex supply chains require sophisticated, connected tools to monitor risks, predict disruptions, and support rapid recovery as part of an overall resilience strategy. For leading companies, this line of thinking has led to an increase in adoption of advanced tools grounded in analytics and visualization.

Content: Article | Authors: Jerry O’Dwyer, Kelly Marchese | Source: Deloitte Review | Subjects: Operations, Risk Management

Rank beliefs not according to their plausibility but by the harm they may cause.

Content: Quotation | Author: Nassim Nicholas Taleb | Subject: Risk Management

Researchers have confronted us in recent years with example after example of how we humans get things wrong when it comes to making decisions. We misunderstand probability, we’re myopic, we pay attention to the wrong things, and we just generally mess up. This popular triumph of the “heuristics and biases” literature pioneered by psychologists Daniel Kahneman and Amos Tversky has made us aware of flaws … [ Read more ]

Content: Thought Leader | Author: Gerd Gigerenzer | Source: Harvard Business Review | Subjects: Personal Development, Productivity / Work Tips, Risk Management

If you can recover from the loss, it’s a risk. If not, it’s a gamble.

Content: Quotation | Subject: Risk Management

Pressure is mounting for organizations to not only detect threats, but to also prevent them—before they can affect critical business processes or sensitive data. These potential threats include enterprise’s brand equity, competitive posture and reputation.

Content: Article | Source: Deloitte | Subjects: Management, Risk Management

Simple decision rules, structures and relationships are not likely to be effective approaches when the task at hand involves making decisions in the context of complex systems. Ironically, many of our most embedded management practices—such as designing for optimization and for efficiency—only exacerbate the risks of things going wrong at a systems level. Somewhat counter-intuitively, the most robust complex systems are often not designed for … [ Read more ]

Content: Quotation | Authors: Gökçe Sargut, Rita Gunther McGrath | Source: Ivey Business Journal | Subjects: Decision Making, Management, Organizational Behavior, Risk Management

Ensuring that a company’s risks are effectively identified, evaluated, and managed is among the most important responsibilities of a board of directors. The science of risk management continues to evolve. Lessons learned from past failures are being leveraged to ensure that a company’s risk management is built on the right foundation and evolving in the right direction. By asking the following seven questions today, directors … [ Read more ]

Content: Article | Author: Eric Krell | Source: Business Finance Magazine | Subject: Risk Management

In risk conflicts, the central question of power is a question of definition. It is the question of who, with what legal and intellectual resources, gets to decide what counts as a ‘risk’, what counts as a ‘cause’, and what counts as a ‘cost’. The question of determining who is responsible, and who has to bear the burden of paying for damages, has been transmuted … [ Read more ]

Content: Quotation | Author: Ulrich Beck | Source: European Business Forum (EBF) | Subject: Risk Management

Risk acceptability depends on whether those who carry the losses also receive the benefits. Where this is not the case, the risk will be unacceptable to those affected. If even the benefit is in dispute it is not enough to demonstrate that the ‘residual risk’ is, statistically speaking, highly improbable. A risk cannot be considered in and of itself. It is always framed by the … [ Read more ]

Content: Quotation | Author: Ulrich Beck | Source: European Business Forum (EBF) | Subject: Risk Management

Technical experts have lost their monopoly on rationality in the original sense: they no longer dictate the proportions by which judgment is measured. Statements of risk are based on cultural standards, technically expressed, about what is still and what is no longer acceptable. When scientists say that an event has a low probability of occurring, and hence is a negligible risk, they are necessarily encoding … [ Read more ]

Content: Quotation | Author: Ulrich Beck | Source: European Business Forum (EBF) | Subject: Risk Management

How can we decide whether a risk is acceptable to society? Using the language of cost-benefit analysis, we can say that the risk is acceptable if its benefits to society exceed its costs. But to say this is merely to re-state the problem, for by assumption the benefits and costs are uncertain. Where these benefits and costs have known probabilities, and where individuals can diversify … [ Read more ]

Content: Quotation | Author: Christian Gollier | Source: European Business Forum (EBF) | Subject: Risk Management

Joe Atkinson discusses how companies can better integrate risk management into their business strategies. Atkinson explains how objectives in business performance can be aligned with a company’s risk management objectives.

Content: Multimedia Content | Author: Joe Atkinson | Source: Business Finance Magazine | Subject: Risk Management

One should not minimize risks any place, for it minimizes opportunities. Minimizing risk is a self-defeating strategy and not a particularly intelligent one… One doesn’t begin with risks. You list the opportunities and then you compare the risk against them. The opportunity-risk ratio determines your strategy, not the risks.

There are risks that you can afford to take because the opportunities are so great. There are … [ Read more ]

Content: Quotation | Author: Peter F. Drucker | Source: Context Magazine | Subject: Risk Management

Supply chain risk is an increasingly common topic and for good reason: Almost any disruption—weather event, supply failure, technology glitch, financial fiasco—can affect a company’s ability to manage its supply chain. Accenture discusses the many forms of risk, surveys risk management technologies and introduces a five-step risk management program.

Content: Article | Authors: Carlos A. Alvarenga, Eric E. Lehmann | Source: Accenture | Subjects: Operations, Risk Management

A primary goal of the funnel is to ferret out the best innovations by winnowing them through a series of stage gates that reduce risk. The reality is often very different. Driven by risk aversion and poor risk management capabilities, the process often weeds out big ideas in favor of small ones. Decision-making bodies often send back proposals for additional research and work, creating time- … [ Read more ]

Content: Quotation | Authors: Adi Alon, Kenneth Hooper, Wouter Koetzier | Source: Accenture | Subjects: Innovation, Risk Management

When the environment is continuously unstable, it is no longer volatile. Rather, we have entered a new economic era… Nothing is certain except for the need to have strong risk management, a lot of cash, the willingness to invest even when the future is unclear, and great people.

Content: Quotation | Author: Jeff Immelt | Source: Outlook Journal (Accenture) | Subjects: Economics, Management, Risk Management

Risk-averse midlevel managers making routine investment decisions can shift an entire company’s risk profile. An organization-wide stance toward risk can help.

Content: Article | Authors: Dan P. Lovallo, Tim Koller, Zane D. Williams | Source: McKinsey Quarterly | Subjects: Finance, Management, Organizational Behavior, Risk Management

Some types of risk pose a peskier problem than others for the success of complex projects, but the outcome of large-scale initiatives ultimately rests on how capably managers and their subordinates can detect and respond to unforeseen emergencies. Changing requirements for the project, shifting customer needs, and communication breakdowns are the most frequent and damaging types of risk.

Content: Article | Source: strategy+business | Subjects: Project Management, Risk Management

Many of the managerial tactics used by companies in their capital-allocation and evaluation processes fail to take note of basic [behavioral biases]. By considering the success or failure of projects in isolation, for example, they fail to understand how each will add risk to the company’s overall portfolio and institutionalize a tendency toward risk aversion, essentially recreating the narrow framing that occurs at the individual … [ Read more ]

Content: Quotation | Authors: Dan P. Lovallo, Tim Koller, Zane D. Williams | Source: McKinsey Quarterly | Subject: Risk Management