Passive risk is a potential for losses due to inaction. Risk is commonly associated with action but can occur from inaction as well. For example, a firm may face competitive risks if they don't take action to innovate. It tends to be difficult to manage passive risk because the things that you're not doing at a particular point in time is more or less infinite. Nevertheless, this type of analysis does have value as passive risks can have just as great a probability and impact as an active risk. It is often possible to identify significant passive risks by brainstorming or comparing your strategies to a competitor or peer.
A potential for loss that occurs due to inaction.
A city at particular risk of earthquakes that takes no action to improve urban planning, building codes and emergency services to prevent loss of life.
This is the complete list of articles we have written about risks.
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A list of common business risks.
The five things that can be done about risk.
A list of techniques for reducing risk.
The potential that you'll achieve too much of a good thing.
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The difference between risk management and contingency planning.
The common types of uncertainty in decision making and strategy.
The common types of inventory risk.
An overview of common business risk management techniques.
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