Risk can take many forms from individual to companywide (enterprise). Regardless of the level there is always a tendency to underestimate the level of risk. Soldiers in combat almost never believe that they will end up a casualty. In fact, people performing jobs considered dangerous regularly underestimate the risk to health and welfare. This same mentality carries forward when dealing with enterprise risk. Ken Olsen, the founder of Digital Equipment Corporation (DEC), stated, “There is no reason why anyone would want a computer in their home.” (1) Personal Computers are now ubiquitous. DEC is out of business. Another famous incident is when Andrew Grove and Intel CEO Gordon Moore decided to exit the memory chip business. It took Intel management two years of churning and emotional trauma before the exit was complete. When one customer was told of the exit, the response was, “What took you so long?”
#4 – STRATEGIC RISK IN THE ENTEPRISE – JIM KLINE – ENTERPRISE@RISK
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