Open AccessThe CoViD-19 Pandemic and the End of Corporate Risk Management as we know it
Author(s) -
Markus Will
Publication year - 2020
Publication title -
central european review of economics and management
Language(s) - English
Resource type - Journals
ISSN - 2544-0365
DOI - 10.29015/cerem.888
Subject(s) - black swan theory , pandemic , resilience (materials science) , risk management , covid-19 , business , supply chain , new normal , psychological resilience , perspective (graphical) , business continuity , crisis management , supply chain risk management , risk analysis (engineering) , economics , supply chain management , computer science , marketing , computer security , finance , service management , medicine , psychology , management , thermodynamics , mathematics , artificial intelligence , psychotherapist , pathology , statistics , physics , disease , infectious disease (medical specialty)
Aim: The article is intended to contribute to a discussion on risks related to the CoViD-19 pandemic, which was started in the last issues of this journal.
Findings: The article discusses the thesis that conventional risk management is reaching its limits in its application in companies, particularly with regard to low-probability but high-impact events its applications seems nor appropriate. In complex and tightly coupled systems like global supply chains, catastrophic events must be considered "normal". The risk of a global pandemic is well known, and at the end of 2019 the first signs of an impending outbreak were also evident. Nevertheless, the global pandemic and the gradual lockdown was surprising in that no precautionary measures were taken. Therefore, this paper argues for a change of perspective from traditional risk management to BCM and for increasing the resilience of supply chains.
Keywords: CoViD-19, risk management, black swans, business continuity, supply chain resilience