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A Novel Multi-Criteria Risk Matrix to Assist in the Strategy Formulation Process: The Case of SMEs

Author

Listed:
  • Jean-Marc Vasnier

    (Cesi Campus Saint-Nazaire, 1 Bd de l’Université, CS 70152, F-40603 Saint-Nazaire, France)

  • Mourad Messaadia

    (#x2020;Lineact Cesi Campus Rouen, F-76808 Saint Etienne de Rouvray, France)

  • Nicolas Maranzana

    (#x2021;Arts et Metiers Institute of Technology, LCPI, HESAM Université, F-75013 Paris, France)

  • Ameziane Aoussat

    (#x2021;Arts et Metiers Institute of Technology, LCPI, HESAM Université, F-75013 Paris, France)

Abstract

Small and medium-sized enterprises (SMEs) are the spine of the European economy and play a key role in adding value in all sectors of the economy. However, due to a lack of methodology and time, SME entrepreneurs struggle to formalize their strategies and too often remain ill-prepared to face today’s potential crises. This paper aims to propose a Risk Management (RM) tool to identify and assess the impact of risks on specific business strategic dimensions. The hypotheses and robustness of the model are tested using Monte Carlo simulation. The analysis shows that a reduced strategic risk matrix (size 4×4) could provide the same quality of information as a full strategic risk matrix (size 20×10) in about 80% of the cases, regardless of the weight of each criterion and the values of each risk factor. The results extend the limited use of RM tool in the field of SME Risk Management.

Suggested Citation

  • Jean-Marc Vasnier & Mourad Messaadia & Nicolas Maranzana & Ameziane Aoussat, 2021. "A Novel Multi-Criteria Risk Matrix to Assist in the Strategy Formulation Process: The Case of SMEs," International Journal of Information Technology & Decision Making (IJITDM), World Scientific Publishing Co. Pte. Ltd., vol. 20(03), pages 987-1009, May.
    • Handle: RePEc:wsi:ijitdm:v:20:y:2021:i:03:n:s0219622021500255
    DOI: 10.1142/S0219622021500255
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