RISK MANAGEMENT AND STRATEGIC PLANNING

Companies are exposed to a variety of risks related to the development and implementation of the business strategy. It is possible to observe an opportunity to analyze how different kinds of risk information can be objectively considered by senior management in order to enhance corporate governance and have sound decision making processes. Strategy formulation is the main part of the strategic planning process. Most common strategic planning tools do not even take risk into account, which worsens the situation. Subsequently, it is time to identify and measure strategic risks. Risk management may also support the development of institutional actions so as to increase the likelihood of reaching the expected results. Therefore, this paper aims to introduce a new comprehensive model which integrates risk management into strategic planning. A number of risk tools, improvements to be made by risk managers and a practical application of the model are presented in order to make possible the establishment and deployment of an effective strategy by the organization. The paper also describes the importance of strategic planning and management for the existence and development of enterprises and business organizations.