What Is Strategic Risk Management?

The definition of the concept of strategic risk still exists in the academic community, but basically does not depart from the basic meaning of strategic risk literally. The basic definition of risk is the uncertainty of loss, and strategic risk can be understood as the uncertainty of the overall loss of the enterprise. Strategic risk is a factor that affects the development direction, corporate culture, information and viability, or corporate effectiveness of the entire enterprise. Strategic risk factors are also factors that have an important impact on the strategic goals, resources, competitiveness or core competitiveness of an enterprise's development and the effectiveness of the enterprise.

Strategic risk management

Strategic risk management

There are many factors affecting strategic risk, and it is more appropriate to define strategic risk as a complex system. Since it is studied as a system, the structure of the system, that is, the constituent elements and interrelationships, has become the most basic problem.

The term "Strategic Risk Management" first appeared in Miller, Kent D.'s article "Integrated Risk Management Frameworks in International Business", published in 1992 in Volume 23 of the International Journal of Business Research 2 volumes.

Miller pointed out five general responses to the uncertainty of the strategic environment: Being avoidance, Control, Cooperation, Imitation, and Flexibility:

1. Uncertainty aversion occurs when managers consider the risks associated with a given product or market to be unacceptable

For a company, if it is already operating at a high level

1. Risk identification and assessment (severity, possibility, timeliness, different time

Prepare for risk reduction and ensure the stability of the company's operations.

If companies are better at risk management than their competitors (especially when they are still using traditional

Strategic risk is only one of the four types of risks facing the company (the other three are financial risks

To reduce the probability of strategic risks,

The importance of corporate strategic risk management is reflected in the following aspects:

1. Response

Strategic control has been neglected for a long time, and people's eyes are mostly on the formulation of strategies. However, many of them are carefully formulated and demonstrated

Strategic risk management

Adequate or even scientific strategies failed in the end, and many of them failed to rectify the direction of strategic development in a timely manner, resulting in out-of-control strategies. Therefore, the establishment and operation of the strategic control system is critical to the success of the business.

In November 2004, the huge loss of US $ 550 million caused by China Aviation Oil (Singapore) Co., Ltd. (hereinafter referred to as China Aviation Oil) for trading oil options shocked not only the Chinese but also the world. Prior to the incident, the company was a public company with a net worth of hundreds of millions of dollars and was awarded the title of "Singapore's Most Transparent Company" in 2003. However, such a listed company with a very promising development momentum suddenly fell into the brink of bankruptcy.

From the analysis of the generation of strategic risks, CAO engaged in the operation of oil options is an innovative behavior that improves the company's revenue. It should be the company's emergency strategy because it is not included in the company's stated strategy, but CAO's senior leaders are The pressure of the company's development did not return to the strategy when the initial loss was small, but to cover up and continue to increase the chips, trying to make up for the initial loss, and eventually it will inevitably form a realistic strategic risk. From the perspective of the construction of the strategic system, China Aviation Oil has not developed a strategic boundary system for market opportunities (off-market oil options trading). If there are, then the selling of options should be excluded from the company's strategic area, because the company's strategic goal is to steadily purchase aviation fuel through hedging. Secondly, the company's emergency strategy for operating options also lacks a detailed internal control system, let alone the establishment of a belief system. Although the Risk Management Manual was established and the Risk Management Committee was established, the control system was completely useless and was not guaranteed in implementation. The above shows that the lack of strategic control of the CAO incident will ultimately lead to strategic failure.

Strategic Risk Management

Basic information on strategic risk management

Title: Strategic Risk Management

Original book title: HE UPSIDETHE 7 STRATEGIES FOR TURNING

Strategic risk management

BIG THREATS INTO GROWTH BREAKTHROUGHS

Author: Adrian Slywotzky

Price: 38.00

ISBN: 978-7-5086-0967-6 / F.1202

Published: 2007-10-1

Folio: 16 open (160 × 220)

Binding: paperback

Introduction to Strategic Risk Management

Regardless of the size of a company, it may be severely hit because it is not anticipated or ready for transformation. When the business is going smoothly, the strategic risk is even greater. Whenever you want to relax or be proud of yourself, it is precisely when you are nervous and vigilant. This book tells you how to transform a crisis into 7 strategies for breakthrough growth: improve your winning rate; understand, not guess customer demand; prepare with two hands; win unbeatable opponents; re-business model to protect your brand; cooperate with competitors, Escape the zero-profit zone; create new forms of demand and make bigger cakes.

About Strategic Risk Management

Adrian Slevoski Mercer Management Consulting Global Vice President and well-known best-selling author, Industry Week hailed it as "Peter Drucker, 21st Century Master of Management". Author of far-reaching bestsellers such as The Profit Zone. It has been named one of the Top Ten Business Bestsellers of the Year by Business Week. Adrian Slavowski writes a lot, frequently writes in the Wall Street Journal and Harvard Business Review. He is also the Davos World Economic Forum, Microsoft CEO Forum, Forbes CEO Forum, and Fortune A well-known speaker at the CEO Forum. Carl Webb is a well-known freelance writer focusing on areas such as business and current affairs. He has co-authored several works with Adrian Slevowski.

Strategic Risk Management Directory

Introduction from risk to opportunity

Chapter 1: Why Is the 90% Link Correct to Certain Success: How to Improve the Win Rate of Key Project

Chapter 2 Why do customers sometimes surprise us? Reduce the risk that they may pose to us by understanding customer needs, rather than measuring them

Chapter III The Risks of the Transition and the Secrets of Two-handed Preparation

Chapter 4 Invincible Survival After Unique Competitors Arrive

Chapter 5. Powerful, Proud, and FragileReconsidering your business model to protect your brand

Chapter 6 Cooperate with competitors when no one is profitable and escape from the zero profit zone

Chapter 7. Creating new forms of demand when your business stops growing

Chapter VIII Treasure Island Reverses Risks to Achieve Growth and Reverses Strategic Crisis