Risk & Crisis: my understanding

It’s no secret that the world is an unpredictable place. Although we may not always be able to predict when or where a risk or crisis will occur, we can prepare ourselves to be ready for it when it does. Despite being common and important topic, I could not understand the difference until my recent experience with the risk and crisis.?

I went to Werribee Zoo with the family for an excursion. Halfway through the trip, my wife spotted a sign ‘snakes sighted in the area, be aware’ and she panicked. I reassured her that this is just the sign that someone has sighted the snake in the past, but it’s no guarantee that we will see it again.

We continued with our trip. Alas, we spotted the snake, my wife screamed ‘snake, snake’. My adrenaline kept pumping and my instinct kicked in to manage the situation. I made my wife calm and slowly moved away from the snake. I informed the people walking by about the hazard and not to interrupt the snake. The snake slithered into the bush, and I contended the situation without any damage. My wife was impressed and praised me for managing the difficult situation in a responsive manner. Aha! my understanding of crisis and risk was clear, and I understood the well-known industry jargon, crisis, and risk.?

When we saw the sign that snakes are sighted in the area, this is the risk as someone has sighted the snake in that area sometime in the past. Depending upon the frequency, the probability for us to encounter with the snake lies between (>0 and <1). The risk is something which has the probability to occur, which in unforeseen but calculated in terms of probability. When we sighted the snake, that probability has changed to 1 and the risk converted into a crisis. I changed my approach from risk management (reassuring my wife, asking her to stay away from grass) to crisis management (taking control of her motions and reassure her to stay calm). In summary, risk is where there is a possibility of occurring the crisis is when an event occur and the probability changed to 1, For example, we are always in the verse of the global pandemic, but when covid hit in 2020 that risk converted into crisis as the event occurred. Australia is prone to flood, which is a crisis, but this year, a lot of areas were with hard hit with flood, an event occurred.

?Few take aways from my experience:

·????????Risk management is strategic, but crisis management is tactical.

·????????Risk can be minimized, but crisis is to be managed.

·????????Risk management is mostly intangible, but crisis management is tangible.

?Are you managing your risks effectively and ready to manage a crisis??#riskmanagement #crisismanagement# small business #Yourbusinessally

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Disclaimer: the story is hypothetical, to explain risk and crisis to people like me who struggle to grasp the business jargon. We did not encounter the snake and Werribee Zoo is safe and beautiful place to visit.