Chapter 2
Risky Business: Turning
Risks into Opportunities
In This Chapter
Understanding the pitfalls and opportunities of risk
Discovering different approaches for managing risk
Automating risk management
Looking at SAP Risk Management
R
isk is a fact of life. No matter what your plans are, whether it’s crossing
the street, going on vacation, or buying a subsidiary — risk is inevitably
involved. However, not all risk is bad. Effective risk management can allow
you to protect the value that you’ve worked to build within your organization
and can also allow you to create new value by identifying opportunities to
build growth, increase competitive advantage, and drive efficiencies through-
out your organization.In this chapter, we talk about risk in a new way and discuss how you can use
risk management to both protect value and create new value. This new
approach to risk management enables you to embed a strategic risk method-
ology across your enterprise, at all levels, from operational management, to
line of business owners, risk managers, and senior executives and directors.
This approach to risk management can help enhance performance and inno-
vation for new products, new processes, and new strategies and can allow
risk to become an additional driver of business change.Discovering Enterprise Risk Management ..................................................
Enterprise risk management provides a framework for your business to identify
your risks and decide which risks are likely to happen and what the associated
impact will be for your business. By managing this type of information, you can
better protect the value that you have created across your business because
you are more aligned with your risks and can mitigate the potential impact of
those risks.