Risk Management

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Why Multinationals Should Consider Geographic Complexity First

  • Research Highlight
  • Read Time: 9 min 

Well-executed international expansions can provide access to new markets, customers, and revenue streams. But many companies underestimate operational complexity and end up with a country portfolio that slowly and subtly erodes profitability. New research offers a framework for managing successful country portfolios and making some key decisions before the next recession hits.

How Companies Can Prepare for Sudden CEO Turnover

  • Read Time: 4 min 

Recent CEO departures have been attention-grabbing but are also part of a larger rising turnover rate for the top job within companies. Chief departures can signal fear and uncertainty within the ranks, and often managers and employees feel a lack of direction for moving forward. To mitigate risk, organizations must take steps to prepare for uncertainty.

Leading in the Age of Transparency

In a data-rich world, company stakeholders know more than ever about the organization and possess unprecedented power to spread the word when something goes wrong. Leaders must realize that the damage to the business and its reputation will be revealed more quickly and spread faster and wider than ever before — so it’s vital that they look carefully at potentially risky decisions and practices.

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How Platform Strategies Continue to Create Value

  • Read Time: 6 min 

Platform companies continue to surprise and challenge conventional approaches to creating value. The 2018 MIT Platform Strategy Summit brought together innovative leaders who are playing a major role in the changing digital economy. Learn from their experience with five major principles for creating new value with platforms.

Get Things Done With Smaller Teams

There are many reasons why large programs fail, but one potential cause is that they simply break down under their own weight. Smaller teams move faster, iterate at a higher frequency, and innovate more for the company. There are ten specific ways that managers can nurture small teams in big organizations, from increasing visibility and accountability to being less formal when sharing information.

Platforms That Grow Are More Than Matchmakers

Platform businesses, like Airbnb or Lyft, often talk about themselves as if they’re merely matchmakers. That’s a smart pitch — when a company is negotiating with investors. But any platform that wants to succeed will have to learn something Airbnb did: Matchmaking isn’t everything. Success also depends on identifying and mitigating risks for your buyers and sellers. The quantity and quality of goods or services bought and sold on your platform will be proportional to the amount of risk mitigated.

Your Customers May Be the Weakest Link in Your Data Privacy Defenses

  • Read Time: 5 min 

Many ethical, lawfully managed businesses have consumer data they aren’t legally authorized to possess, obtained from a surprising source: their customers, who inadvertently share the personal data of family, friends, and colleagues. And in the wake of the Cambridge Analytica scandal and the enactment of the EU’s General Data Protection Regulation, peer-dependent privacy is emerging as a critical consideration for businesses.

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Tangled Webs and Executive Naïveté

  • Read Time: 6 min 

Leaders in a digital world have to navigate more complexity than ever before, where a problem that arises in one node of such network work can spread easily, with widespread adverse impact. But complexity-induced problems often have similar fundamental causes — and similar solutions. Leaders can ameliorate the effects of complexity by developing broader, not just deeper, perspectives; learning to think in terms of scenarios; and being clear about strategic intent.

How to Develop Strategy for Execution

When developing strategy for execution, managers often want to start by setting their strategic priorities, but that’s a mistake. Management teams should start by identifying the corporate vision and critical vulnerabilities — both of which help clarify and shape priorities.

Digital Audits as a Tactical and Strategic Management Resource

  • Read Time: 6 min 

New factory audit processes help companies that outsource production to evaluate supplier performance in more depth, leading to more effective decision-making. Three key issues that hamper modern auditing — standardization, cost inflation, and fraud — are being mitigated by new systems that automate the inspection process while tailoring it to specific inputs. The result: analytical capabilities that go beyond the classic audit model.

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Which Rules Are Worth Breaking?

Creating innovative products and services that disrupt the status quo requires creativity, and creativity involves thinking differently about constraints. But too much of a “the rules don’t apply to us” attitude can lead to ethical crises. That’s what’s happened at Uber, where a string of controversies led to a mass exodus of executives, including the company’s president and CEO. Organizations intent on innovating need to understand ahead of time the consequences of breaking certain rules.

What Executives Get Wrong About Cybersecurity

Cyberattacks are in the news. All kinds of organizations — ranging from Target Corp. and Bangladesh Bank to the Democratic National Committee in the United States — have fallen victim to them in recent years. MIT cybersecurity expert Stuart Madnick explains some of the biggest cybersecurity risks businesses face today — and what executives should do to decrease their companies’ vulnerabilities.

A Fresh Take on Supply Chain Innovation

  • Read Time: 5 min 

For PepsiCo, entering the natural beverage markets of coconut water and smoothies meant developing new risk-management practices. In the coconut water business, “lead times are longer and supply is more variable than in PepsiCo’s traditional beverage supply chain,” write Tim Rowell of PepsiCo and James B. Rice Jr. of the MIT Center for Transportation & Logistics. “The company has had to build enough inventory to minimize stock outs — without causing excessive losses through obsolescence.”

Showing 1-20 of 105