of risk. But we shouldn’t forget that many risks also have positive consequences. Effective risk management can help us to reduce the negative and increase the positive consequences of risk, thus helping our business to grow and flourish. Risk management has a part to play in your decision making, whether it be with regard to business start-up, strategy, exploiting opportunities, managing your various projects or in your day-to-day business operations. Risk management can help you to justify your decisions – to your management team, your employees, your business partners, investors, creditors or customers – and it should mean that you go into things with your eyes open; that you make informed decisions rather than just acting on a gut feeling or a hunch.
“While ‘risk’ is commonly regarded as negative, risk management is as much about exploiting potential opportunities as preventing potential problems.”
BS31100:2008 Risk Management Code of Practice, British Standards Institution
Hints and tips The foresight saga...
Hindsight, as they say, is a wonderful thing. It allows us to be wise after the event. With the benefit of hindsight it’s much easier to see something that now seems obvious. How often have you heard the phrase “it was an accident waiting to happen” after the accident has happened? Effective risk management aims to make us wise before the event – to use foresight, rather than hindsight, to identify potential problems and prevent the accident, incident or disruption from occurring in the first place. Hindsight may be said to be a wonderful thing, but in reality it’s a bit pointless. If you can develop a culture of foresight rather than hindsight, it’ll make your business much more resilient.
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