Key Term Business Risk

Improved Essays
Key Term and Why are You Interested in it
I choose the key term business risk because I am interested in the causes of business failures and possible ways to prevent it. Business risk influences are the negative impacts of sales, costs, competition, or economic conditions. Supply and demand factors could also result in the failure of a business. The three types of business risk are ownership risk, operation risk, and transfer risk (Satterlee, 2014). In an effort to protect and prevent business failure, business professionals must be aware and prepared for the threat of anything that could cause damage to the company’s profits or reputation. It is imperative that managers and leaders monitor any threat to the success of their business (Satterlee,
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It asks the questions, what are the key decisions that are made in the business, when are made, who makes them, and why do those individuals make the decisions that they do? It generates ideas for innovation and combating business risks. The article summates about designing or redesigning a company’s business models to better tolerate risk and outpace …show more content…
Mujtaba (2015) indicated that successful businesses must develop ways of continually questioning what they do, when they do it, who does it, and why they do it. Risks should be tracked and planned for processing business transactions. Otherwise, damaging risks can assert their presence eventually in a reactive, urgent, or crisis manner. With said, many firms increase their risk of failure by becoming complacent. Successful businesses constantly develop ways to avoid loss due to risk factors. Additionally, Mujtaba (2015) conveys that information risk is business professionals make management decisions without having all the needed information. They must understand the risks that their business are facing and focus on eliminating those risks. As stated by Satterlee (2014), successful business professionals identifies potential risks, assesses them and their profits potential, and then apply the appropriate risk mitigation tools in place(p.99). The mortality factors in businesses are related to the business’ characteristics, as well as to the way that the handle resources. The lack of a formal plan, as well as a lack and or bad management of the functional area resources are the most common. The mortality factors in a business is directly related to what occurs outside the business. Which are unfortunately outside of the manager’s

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