Early warning indicators

Looking at the turbulences in today’s markets and business environment, companies need to be prepared for sudden developments. The coequally increasing rapidity, as a result from the proceeding globalization, forms a special challenge with regards to that task. Hence, firms have to be prepared early enough in order to stand critical changes and utilize promising ones. Following that argumentation, it is entirely obvious that there is a need for early information to build business decisions upon. But how to obtain such prewarning knowledge? How can companies measure whether, when and to which extent they may become endangered by future critical events? Early warning indication is the answer to those questions. And exactly here, this book by Jaeger and Maciejewski starts its investigation. It analyzes the role of forecasts, leading indicators and weak signals in the light of financial crises. In so doing, this book provides a comprehensive overview of the adjacent management disciplines - risk and crisis management as well as management accounting. However, not only the theoretical models and concepts are examined in detail, but also the interrelation between those leadership approaches is illustrated. It is shown in how far early warning is integrated into those concepts and where the differences are. This publication highlights the utilization and necessity of prewarning knowledge. It is proven that especially under consideration of financial crises early indication plays a significant role – both strategically and operationally. Alongside the demonstration of the importance of that management approach, this book offers a critical discussion highlighting the limitations to early warning and concludes with the idea that there is still room for conceptual improvement – particularly in terms of strategic early indication.