Risk Management in a VUCA World: Practical Guidelines Based on the Example of a Multinational Retail Group

Abstract

Regardless of the legal necessity, increasingly more companies are coming to recognise the massive need to implement a holistic risk management system. This is especially true of retail groups operating multinationally, which are being exposed to an increasingly complex and dynamic VUCA world. By adequately implementing a risk management system, risks can be overcome despite this increased uncertainty and volatility. Assistance in implementing a risk management process commensurate to the requirements of a VUCA world is provided in the form of practical guidelines. At the same time, the process must be designed quickly and easily in order to maintain its power to act in the face of greatly reduced reaction times and increased complexity. With regard to organisational integration, different alternatives are compared and recommendations for practical actions to be taken are suggested. Risk management must be supported by an IT tool that specifically allows for cross-border utilisation by multinational companies. Its interfaces need to pass on meaningful reports that present a company’s overall risk situation in a manner that reduces complexity. This promotes immediate countermeasures in a dynamic and volatile business environment. Ultimately, it is the function of risk management to ensure the company’s long-term success despite the growing challenges of a VUCA world.