CEOS and CPOs could manage uncertainty more successfully by eliciting on their expertise, know-how and data, including signals from their competition. It will help to anticipate potential outcomes and detecting the place they are likely to happen.
Given the technology already existing and its developing power, give your company time to act by reading their competitors’ most likely moves. Those who look at prevention methods are most likely to be less tense than those who do not take any measure to face them. Anticipation helps the brain adapt to a variety of outcomes.
Reducing risk exposure to a ‘zero state’ is the tendency, but by all means, it is both impractical and unrealistic. To survive, thrive and not die in the face of uncertainty, you need to adapt and move up quickly; if not, competitors will destroy you. Do not wait too long to take the right steps, because those who overcome uncertainty and adapt soon, will, no doubt, come out of risks.
Why not engage, both positively and negatively, to optimise risk exposure?
Risk mitigation and treatment effectiveness within most mature risk, contribute as a means to healthier profits, sustainable triple-bottom-line performance, operational improvement, and the like. Several world’s top enterprises have enhanced their long-track record of success by continually re-inventing their risk management procedures.
Let’s take Apple as an example: they re-designed the "re-invention" business. How? First, they did not invent any of the machines that made Apple a so well-known name, but they have the intuition to make devices much better. Apple's greatest re-inventions came when it changes their attention away from computers towards hand-held devices.
The same happens with the iPad, iPod and iPhone. Those were not the first MP3 player or smartphone, but their design and cutting-edge touchscreen tech, lightweight design, plus incredibly powerful processors and batteries, modernised the gadget industry.
Apple's next re-invention hang around to witness; by all means, they are one of the experts coping with uncertainty.
So, how do we optimise risk?
There are many tools and techniques available. However, in the long run, be conscious of the sweet spot between two levels fully: the level of investment and the level of exposure; it is the equation that needs solving.
Risk optimisation is a process of trial and error and exposed to regular uncertainty. Most of the times, risk management is considered as a means to reduce negative consequence arising from a risk source. Risk management contribution towards value creation and protection is a driving force to provide direction to businesses to succeed over uncertainty.
8 Step process to secure risk optimising challenge:
1. Be aware of the production performance metrics which would stand for success.
2. Set up the existing financial plan that can be spent to cope with risk.
3. Pinpoint and evaluate risks related to the project or organisational background.
4. Dedicate management options to risks that demand supervision.
5. Outline resources distribution to deal with risks.
6. Evaluate the ROI as a relative amount.
7. Establish a risk range making evident the optimisation of risk exposure relating to the activities, products or services of the strategy in the enterprise.
8. Link the capital spending to the production target and determine the discrepancy; take further actions to spend or not to adjust risk experience.
Further comments: managing uncertainty is also an opportunity, as it rises out of nowhere impacting our decision-making. On the other hand, it forces us to adapt to the pressure of the moment. The Dalai Lama once said, “the enemy is a very good teacher.” If uncertainty appears, there is resilience to survive it rapidly, whilst moulding the character of your leader, and mainly that of your enterprise.
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