Generic Risk Management

The term risk is often confused with “hazard”, which means the potential of causing harm. Risk, however, is the probability that the realization of formulated (business) goals/plans/objectives for the future is uncertain. The resulting exposure (hazard) of net profit or cash flow, etc., can not be avoided, but must be managed so that “down-ward risks” are limited and potential “up-ward risks” monitored and left some room – in order to fully leverage the upside.