Strategic management means thinking big and long-term: defining the big goals the organization wants to achieve, and developing plans to achieve those goals. For example, if a company wants to become the leader in a particular industry, strategic management will determine the steps to achieve this, such as entering new markets or developing innovative products.
Risk management means thinking about things that might get in the way of achieving those goals: identifying what could go wrong, and developing plans to deal with those problems before they happen. For example, if a company is planning to enter a new market, risk management will think about potential challenges such as competition or changes in laws, and will develop plans to address them.
The relationship between them:
Strategic management defines the path the organization wants to take, and risk management ensures that the path is safe and that there are plans to deal with any obstacles.
When strategic management and risk management work together, an organization can anticipate potential problems from the beginning and be prepared to deal with them.
Strategic management gives direction and vision, while risk management provides security and stability to ensure this vision is achieved.
