Sources of Risk: Microsoft
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Twenty years ago, risk management meant buying insurance against fire, theft, and liability losses.
Today, though, due to globalization, volatile markets, and a higher propensity to sue, a multitude of risks
can adversely affect organizations in all industries. Microsoft addressed these risks by creating a virtual
consulting practice, called Microsoft Risk Co., to help manage the risks faced by its sales, operations, and
product groups. In a 1997 article, Scott Lange, head of Microsoft Risk, identifies 12 major sources of
risk. What do you think would be the major sources of risk to Microsoft?
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Solution Summary
This solution explains the risks faced by Microsoft. The sources used are also included in the solution.
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Step 1
The twelve major sources of risk identified by the Scott Lange are business partners, competition, customers, distribution systems, financial, operations, people, political, regulatory & legislative, reputation, strategic (mergers, acquisitions etc), and technological. These risks need to be identified, monitored, and mitigated for the successful running of the business.
Step 2
The major sources of risk to Microsoft are Competition, Financial, Technological, and Reputations.
Competition is the most important source of risk. This means the risk of losing market share, price ...
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