Final answer:
Strategic Risk arises from societal and economic trends that affect an organization's ability to execute strategies and achieve goals. It requires careful analysis and strategic planning to mitigate.
Step-by-step explanation:
The risk described is a Strategic Risk. This kind of risk emerges from economic and societal trends, including shifts in the political, economic, and competitive landscapes, as well as demographic changes. Strategic risks are events or circumstances that could significantly affect an organization's ability to execute its strategies and achieve its goals. They are often beyond the direct control of the organization and require careful analysis and strategic planning to mitigate.
Examples include changes in market demand due to economic downturns, new competitive threats due to technological advancements, or loss of key demographics shifting to different consumption patterns.
The interconnectedness of markets, potential for resource disruptions, and environmental challenges such as climate change contribute to these strategic risks. Companies must remain vigilant and adaptable to manage these risks and ensure long-term success.