One of the essential concepts in risk management is risk velocity, or the time between exposure to a risk and its impact on an organization.
Technological advancement has accelerated the speed of business, which also means risks may affect and spread within a business quicker. This is why technology is needed to help managers keep up with risks.
‘Risk velocity is how long it takes for risk to impact an organization or the time it takes from occurrence to impact,’ said David Wald, co-founder and CEO of risk management firm Aclaimant.
‘For example, take the timely idea of the spread of COVID-19. Risk managers must account for the velocity of the virus passing from person to person and how long this takes to impact the overall business.’
Risk velocity is not uniform across risks and organizations â€“ some risks move faster than others and some organizations are more vulnerable than others.