Risk versus vulnerability

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Accidents will happen. Four strategies for coping: three focus on the accident, one focuses on your organisation.

• Dealing with accidents:

• Respond to accidents when they happen
• Limit damage accidents can cause
• Minimise chance that accidents happen

• Dealing with your organisation: Assuming accidents will happen, reduce vulnerability to them. Vulnerability comes in the form of unusual concentrations:

• Concentration of energy — in a financial services firm, call this financial risk, or profit-and-loss generators
• Concentration of population — different models of distributed network. Compare “hub and spoke” models like airports (fragile — take out a hub and large parts of the system are inoperable) with “multiple-node” networks like the internet (robust — take out a node and everything can flow a different way).
• Concentration of political/economic power— increases the vulnerability to harm from executive failure.