Strategic Risk Management
What is Strategic Risk Management?
Strategic risk management is the process of identifying, assessing, and mitigating risks that may impact an organization's ability to achieve its strategic objectives. It is a proactive approach to managing risks that involves identifying potential risks and developing strategies to minimize their impact on the organization.
Strategic risk management includes several key steps:
- Identifying risks: This involves identifying the potential risks that could impact the organization's ability to achieve its strategic objectives. This can include risks related to internal operations, external market conditions, and other factors.
- Assessing risks: This involves evaluating the likelihood and impact of identified risks on the organization. This can include analyzing the potential consequences of different risks and determining their likelihood of occurring.
- Mitigating risks: This involves developing strategies to minimize the impact of identified risks on the organization. This can include implementing controls and processes to reduce the likelihood of risks occurring, or developing contingency plans to minimize the impact of risks if they do occur.
- Monitoring and reviewing risks: This involves regularly reviewing the organization's risk profile and monitoring the effectiveness of risk mitigation strategies.
Strategic risk management is an important aspect of organizational planning and decision-making, as it helps organizations identify and address potential risks that could impact their ability to achieve their strategic objectives. It can also help organizations identify opportunities for growth and innovation.