8

Risk, opportunity and sensitivity

“When written in Chinese the word crisis is composed of two characters. One represents danger, and the other represents opportunity.”

John F. Kennedy

In this chapter

  • Meet the Suns and Clouds chart
  • What the suns and clouds tell you
    • Extraordinary risk
    • The balance
    • Bankers and investors see different skies
  • Sensitivity testing

You’re almost there. You have set out the market context in which your firm exists, how it is positioned in that market and how your strategy will deploy the firm’s resources over the next few years. You have developed a set of financial forecasts that are consistent with that context.

All you need do now is set out what could go wrong with these forecasts – and also what could go ...

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