A bold new solution for Risk Management

The world is often a dangerous place to do business in. For an organization to survive it must become adept at identifying and managing possible risks. In our personal lives we do this every day, often without thinking about it. Before we cross the road, we look around to make sure there isn't a vehicle heading towards us. And every parent weighs up all potential dangers before allowing their child to run the risk of riding a bike outside. Businesses have to make predicting, recognizing, and minimizing risk as natural and habitual as this.

Some risks affect all businesses, such as the unpredictability of economics (e.g. inflation), politics (e.g. new legislation), and business realities (e.g. late payments). However, there are also risks specific to each sector. In the telecommunications sector, a mobile phone company has to anticipate shifting customer taste in a market that is moving so fast it's hard to look one year into the future, let alone ten.

It's been said that the species most likely to survive is the one most responsive to change. The problem in risk costing is that progression and change in today's world is no longer linear and predictable. The only successful business will be one that accepts uncertainty and is flexible enough to answer to change as it comes. That's where Watchman can help. This impressive software accepts a variety of inputs and then produces a stunning three-dimensional graphic display that allows you to view various risk factors at a glance, all against an interactive timeline. Intuitive controls allow you to filter the output to compare probabilities, determine the relative importance of each risk factor, and evaluate potential impact. And, of course, you can alter the variables to gauge how different conditions make an impact - in the hope that this knowledge will help you to avoid exposing your organization to unnecessary risks.

So it's great as far as it goes, but there is a problem. If the input you provide is incomplete this will affect the quality of the risk analysis. Watchman can't do the thinking for you and it can't determine whether a threat is directly characteristic to your company. It's a sound program, but it's no replacement for the skilled, intuitive work done by anexperienced risk manager.

Tony Caram, Director of Business Strategy

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