Mastering Catastrophic Risk
How Companies Are Coping with Disruption
-
- $19.99
-
- $19.99
Publisher Description
A profound and insightful look at how company leaders prepare for and respond to shocks and crises that threaten their business.
Successful firms strategically manage and are more accurate in their assessment of large-scale risks. Doing so is increasingly challenging given the pace of change, whether financial, technological, regulatory, or environmental. Mastering Catastrophic Risk provides real-world practical insights into how large companies are responding to this new reality and develops a framework for smarter thinking about events that can damage a business.
As leading authorities on risk management, strategy, and company leadership, Howard Kunreuther and Michael Useem take us on a groundbreaking tour of firms' decision making process. They demonstrate how improving readiness for and resilience against future shocks is now an integral part of company strategy. Using the "DISRUPT" model they have developed, they highlight the seven primary Drivers of disruption: Interdependencies increase exposure; Short-term focus results in limited vision; Regulations require change and constrain opportunities; Urbanization increases the costs of disasters; Probabilities of disasters have increased; and Transparency has enhanced public awareness of problems and impacts on firms' reputations.
Some disruptions can be anticipated, while others arrive without warning. Their onset stresses decision makers, impairs company operations, and may even put the enterprise at risk. The bottom-line: business leaders and their governing boards face ever more challenging disruptions and must be ever more on guard. If your company is hit tomorrow, will it bounce back, or drown?
PUBLISHERS WEEKLY
Three Wharton professors, who previously coauthored Leadership Dispatches: Chile's Extraordinary Comeback from Disaster, take a thorough, if dry, look at risk management. They set the stage by noting that "given the increasing pace and scale of disruptive events," corporate leadership is under more pressure than ever to manage risk well. Executives and directors don't need to learn necessary lessons through experience, the book posits; through scenario planning exercises, they can learn from the mistakes of others and forestall their own crises. The authors interviewed more than 100 prominent figures from a variety of industries about their mistakes and corrective measures. The book works best at its most concrete-outlining the kinds of thought processes, such as an intuitive approach to calculating risk, that require radical change, and risk-management practices that can help, such as Dell's moves to diversify and monitor its supply chain after a 2001 flood in Bangkok shut down one of the company's main plants. The authors also helpfully highlight some major players, including Lufthansa and Deutsche Bank, that have used their mistakes to set up programs to avoid them in the future. Nonetheless, the focus on dramatic case studies does not compensate for the off-puttingly academic tone, and there are many easier-to-digest books on the same subject available.
More Books Like This