Business organizations are impacted by risks of all kinds – market risk, manufacturing risk, new product or service introduction risk, project risks, risks arising from competitor activities, key personnel attrition risk, recruitment risk, legal risk, business disruption risk, IT-failure risk, country risk, default risk, etc. Many of these risks can have a severe negative impact on the business and may even threaten its existence. Risk assessment is therefore, particularly important and involves sophisticated modeling. Moreover, risk management and mitigation strategies critically depend on accurate risk assessment.

While the downside of risk often gets greater management attention due to its potential for generating outcomes with severe negative consequences for the employees and the management of a firm, the upside of risk is often ignored. The upside of risk can offer organizations unprecedented opportunities which, if capitalized on, can lead to great business success.

Senior managers working in modern business organizations therefore, need to have a clear understanding of the various dimensions of risk, methods of risk modeling and risk assessment, and techniques of risk management. They also need to be aware of the great opportunities thrown up by the upside of risk and the necessity to have a plan ready to capitalize on the same.