Early Warning Systems
Tools and processes used to detect early signs of competitive threats or market shifts, allowing a company to respond proactively.
Implications
Systems or processes designed to detect early signs of potential risks, problems, or opportunities, allowing organizations to respond proactively before issues escalate or to capitalize on emerging trends, commonly used in risk management, finance, and operations.
Example
Example: A financial institution implements an early warning system to monitor key economic indicators and customer behaviors that might signal increased risk of loan defaults, enabling preemptive action to mitigate losses.
Related Terms
Different from reactive management, which deals with problems after they arise, early warning systems aim to anticipate and address issues before they become significant.
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