August 23, 2023 | McKinsey & Co.
An organisation faces business risk when it is exposed to a situation that can lead to decreased profits or even bankruptcy. This article explains the importance of managing that risk.
Risk management strategies: three components of a robust risk management strategy are:
- – detecting risks and controlling weaknesses
- – assessing risk appetite
- – deciding on a risk management approach
- Risk-based cybersecurity approach – the article describes how a risk-based approach to cybersecurity can help organizations prioritise and mitigate their most critical vulnerabilities and lists eight actions to implement it:
- fully integrate cybersecurity into the enterprise risk management framework
- identify the sources of enterprise value
- define the vulnerabilities within your people, processes, and technology
- determine threat actors and their techniques
- categorize and address vulnerabilities
- build a risk-based cybersecurity model
- implement the model and monitor its performance
- continuously improve the model and adapt to changing conditions
- Scenario planning and big bets: scenario planning can help business leaders understand uncertainty and challenge conventional wisdom also how to make the right investments in risk management especially for high-consequence, low-likelihood risks
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