Risk Perception and Appetite

by | Feb 14, 2020 | Change |

A specialised, focused organisation takes risks large, more generalist organisations don’t. The risk is no different, in fact the impact of the risk on the specialised agency is far greater. However the risk is calculated and is in line with its values, brand, and desired direction of travel, so it takes the risk.

The larger organisation has multiple ‘specialisms’ and worries about the failure in one infecting the others. Infecting and damaging the brand globally and thereby all the ‘specialisms’ results in a lower risk appetite. The irony is that because of being larger with multiple specialisms, the larger organisation is more stable. It can absorb a failure in one specialism much easier than the specialist organisation who’s whole business is this.

And yet, most smaller agencies have a higher risk appetite. Larger organisations focus on keep the status quo.

It’s all a matter of perspective. What is yours?

Photo by John Moeses Bauan

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