Welcome readers to a journey through the entangled terrain of strategic risk! Consider you have a smartphone company and your firm is preparing to launch a brand new device in the market. You have done your marketing analysis and have some calculated assumptions regarding your target market. Now while launching you face some unforeseen obstacles, such as shifting consumer tastes, that prevent this plan from succeeding.

Taking a classic example of Blackberry. Who doesn’t remember the sleek and elegant keypad device, considered pretty high-toned back in the day! Blackberry faced the strategic risk when it was unable to adjust to the touchscreen trend, drastically affecting it’s position in the market. A company’s long-term success may be impacted when its strategic decisions or actions fall short of its goals, which is known as strategic risk. In other words, strategic risk refers to the uncertainties and potential pitfalls a company faces in achieving its business objectives.
Strategic risk being very dynamic in nature, cannot be categorized into definitive types.
However, let us explore some types of strategic risks:

1. Competitive Risk: It is essentially the threat of rivals surpassing your business. A new entrant in a competitive market with an innovative product would be a risk for the existing players.
2. Market Shift Risk: The dangers which are brought along with the sudden changes in the current market conditions. Economic downturn or catastrophic incidents like Covid-19 would be great examples for this.
3. Business Model Risk: The vulnerabilities of a particular way of doing business. The current trend of shifting business from brick and mortar to e-commerce impacting the traditional physical retail businesses.
4. Innovation Risk: Risk associated with new technologies and approaches. For technology that doesn’t gain expected market traction, what’s better than taking our favourite Blackberry example!
5. Reputation Risk: Potential harm to a firm’s image and brand value. Remember the 2015 Maggie controversy? Nestle faced a serious crisis when Maggie Noodles were found containing elevated levels of lead and MSG.
6. Geopolitical Risk: When risks are arising from political, social or economic factors in different countries, for example, trade policy changes affecting business between any two countries.
   Understanding different arrays of strategic risks will equip us to work on enhancing the strategies, and proactively address any potential challenges, if not eliminate those in the first place!
   -Team Risk Unplugged