Evaluating Nonmarket Risks

Abstract

Analyzing thoroughly the environment in which a business operates is undoubtedly one of the most important keys to success. Obviously, a company is not run in a vacuum there are a great many factors which need to be taken into consideration by the company executives before making any business decision. A lot of companies have come to recognize the growing importance of the nonmarket environment, and the inevitable need to manage it. Over the last few decades, a significant number of businesses experienced utter fiasco, due to their inability to manage the non-market issues properly. Numerous techniques have been developed in order to aid CEOs in eliminating the companies exposure to the non-market risks, some of which have been proven to represent a major threat to the company s market performance. This paper discusses the nonmarket components of the business, the necessity to integrate the market and non-market environment into a business strategy, and the possible ways of tackling non-market issues.