In our fourth exclusive extract from Crawford & Company®’s new report, Scenario planning and adapting to emerging risks—a risk manager’s essential guide, we consider how corporates are conducting simulations to help them prepare for the worst.
Anyone connected with the response to natural and man-made catastrophes in the past five years has been on a steep learning curve.
The most successful businesses are those that have emerged from their experiences with an informed view of the steps they need to take if their assets are under threat from natural or man-made incidents.
In this chapter of the report, Vice President of Catastrophe Operations Bud Trice and Vice President of Global Markets Nick Stretton, explain how increasingly, this is being done by businesses conducting detailed drills or simulations that put the company through its paces—helping them to understand how best to handle a dynamic situation.
“Although complex to administer, drills and simulations—particularly for high-risk industries—are an important part of the enterprise risk management framework,” states the report. “Very high-risk industries, such as chemicals, fuels and the transportation of such are amongst the greatest proponents of ‘spill drills,’ with corporate risk managers adopting an ‘inject’ problem into a scenario that builds a level of unpredictability and keeps everyone on their toes.”
To find out more about how corporates are including scenario planning in their ERM frameworks, download the exclusive Crawford report, here.