Strategic planning and risk management are critical and interconnected processes for organizational success. It is essential that risk assessment represent a component of the planning process. The last decade has seen an explosion of risk in everything form cyber attacks, pandemics, inflation, supply chain disruption, mass shootings, and war.
A framework such as a SWOT analysis can help integrate risk management in the planning stage, since SWOT specifically addresses “weaknesses” and “threats.” The board has specific insight into the industry conditions that can be of concern but external expertise, such as information technology, insurance, finance/audit, or supply chain could be considered. Risks should be enumerated relative to their likelihood, and contingency or mitigation strategies developed. The board should continually track risks and adjust strategies as needed.
