At the most basic level, risk management can be described as the tactical methods with which an organization identifies, evaluates, and effectively responds to threats posed to capital and profits. Risks may be associated with any number of external or internal factors, ranging from legal concerns to critical errors in organizational strategy (to say nothing of the innumerable industry-specific risks that can threaten earnings). Other potential risks may be posed by threats as diverse as financial uncertainty (organizational or industry-wide) and natural disasters, as well as other unforeseen accidents.
In today’s digital world, IT security threats represent an entirely new category of organizational risks that must be accounted for, especially in regards to sensitive data that may be stolen or exposed. In fact, securing this data has become a top priority for digitized companies, with a particular emphasis on a company's proprietary content, intellectual property, and any personally identifiable information belonging to clients or customers. With this in mind, it is no wonder that an effective organization’s risk management plan should be viewed as a dynamic strategy, adapting to every new threat and piece of information that is analyzed.