“Living with fear stops us from taking risks, and if you don’t go out on the branch, you’re never going to get the best fruit.” – Sarah Parish, English Actress
What is risk? Is it a fear or lack of confidence?
Risk is the effect of uncertainty. The effect could be a positive one or a negative one. But today, let us talk about negative risks.
All Human beings face risks right from birth to death. In today’s world people are exposed to various type of risks both in their personal lives and businesses, be it infectious diseases like COVID-19, extreme weather conditions such as heat wave, floods, earthquakes, terrorist attacks, social cohesion erosion, youth disillusionment, environment damage, cyber-attacks, etc. Assessing, managing and mitigation of risks are real challenge for human livelihood and also to business organizations in order to attain stability and continuity of businesses.
In the business perspective, risk implies uncertainty about deviation from expected outcome. Risk is the uncertainty about the realization of gain against the investment made.
All the business entities will have the risk of running the business. In the organizations, business risks usually occur in one of four ways: strategic risk, compliance risk, operational risk, and reputational risk. It is very much essential to identify and asses these risks upfront so that impact of risk can be minimized or nullified. Risk assessment is a process to identify potential hazards and analyze what could happen if a hazard occurs.
Impact of COVID-19 has resulted in accelerated expansion of digitalization in all aspects viz., e-commerce, online education, digital health and remote work. Dependency on the digital environment resulted in higher risk due to cyber security, IT disaster, etc. It is very much essential to view and assess the business risks in wider angle so that the risks are effectively managed. Methods for risk management can be multiple as like avoidance, retention, sharing, transferring, loss prevention and reduction.
An effective risk management helps the organizations to improve their performance with consistent operations, have enhanced focus on security, encourages innovation, keeps stakeholders satisfied and more important, a healthier bottom line.
Below are some of the real-life examples of risks that were not managed effectively. If they had been, the impacts would have been avoided or controlled.
Global disasters are coming harder and faster. Here’s how we can cut the risks. Read the news here
More than 40 Nations can default on loans, affecting everyone. Known risk that needs to be managed properly. Read the news here
Known Risk of Climate Change, this too needs to be managed properly. Read the article here
Have your organization considered the risks related to operations, information security and cybersecurity? We can help you!
At Gorisco, our motto is 'Embedding Resilience' and we are committed to make the organizations and their workforce resilient. Reach out to us if you have any queries, clarifications or need any support on your initiatives.
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