Explain why it is important to develop plans to compare planned risk to actual risk performance
Ans- Managing the risk plays a vital role in the success of the organization. Even the Bigger Corporations can't control their economic and competitive environment around the risks. There are so many unforseen events that should be deal quickly before its negative consequences.
Planning helps to reduce the risks involved in every business which may happened in future. By developing the plans, we are able to know the planned risk. When the actual risk happened, we can easily compare between the planned risk and actual risk performance. It is important to know the comparison between the two because it helps in knowing the deviations which teaches us where we are wrong in the planning process. Deviations works as a feedback which gives the learning to not do more improvements in the future planning process.
Planning increases the scenarios of "what if" where managers attempt to know all the possible factors of risk and develop the contingency plans to deal all the risks. The Pace of change in every business is very much fast and the organization must rapidly do the changes in the strategies according to the changing conditions.
So, this was about why planning is important to compare the planned and actual risk performance.
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Explain why it is important to develop plans to compare planned risk to actual risk performance
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