A Roadmap to Understanding Enterprise-Wide Risk Management principles, frameworks, methodologies and tools.

In a world of risks and constant changes, effective risk management has the potential to increase the reliability of operations, build resilience, and foster innovation/value creation—three keys to achieving sustained performance. Too often, companies have a static, assets-based approach to the risks that they are facing. When managing risks, they essentially rely on risk-control mechanisms. As a result, risk management programs often deteriorate into narrow compliance and lead many organizations to underperform.

This module workshop provides a framework in developing a dynamic vision of risk management called Enterprise Risk Management (ERM).

The success of any firm depends jointly on its ability to create value and preserve value. The creation of value arises when a firm is able to identify and execute investments with a positive net present value. However, the creation of value invariably exposes the firm to risk and this value can easily be jeopardized. A fall in demand for its product, a sudden rise in production or financing costs, a technological failure, destruction of assets or information, a liability suit, or the activities of an employee, can easily wipe out the value that was created. In extreme cases, this may even bankrupt the firm.

Firms need to devote increasingly more time, attention and resources to craft strategies related to manage more effectively the new risks and uncertainties emerging in today’s global and volatile business environment. Learn how to build the business case for risk management and how you can deploy an enterprise wide risk management system that makes a real difference in how well your organization could deliver on its performance potential and how to realize the promise of ERM.

Module Workshop Content

• Concepts (Exposures, perils and hazards, categories, loss frequency and severity) and Foundations of Risk & Risk Management
• What is Integrated Risk Management & ERM? Holistic risk management vs. the "silo" approach.
• The purpose of risk management: Protect assets or create value

• What are the key drivers for adopting ERM? Trends on current ERM developments in both public and private sector
• How the business case for ERM can be made internally? The Costs and Benefits of ERM
• Connecting ERM and Strategy:  It’s All About Adding Value
• Understanding the Risk Management Process and the ERM Framework

• What are the positive and negative impacts of ERM on organizations? And why?
• Who should be in charge: What are the roles of the board, the CEO, senior management, business leaders, Chief Risk Officer (CRO) and internal audit?
• How can vision be turned into reality? What strategies, activities and resources are needed and available for ERM project?
• How does organizational culture affect ERM launch?  What are the critical culture issues to address? How to get leadership support and foster employee buy-in
• What are some effective benchmarks for evaluating ERM progression?

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Manager’s Toolbox for Effective Risk Decision-Making Strategies & Techniques

Modern Organizations are now confronted with increased volatility and complexity in today's global business environment. The interaction of many forces - social, cultural, political, financial, environmental, and legal - form both an internal and external landscape or topography of the organization which defies easy definition. All decisions involve a degree of uncertainty and there are tremendous risks inherent in most key issues facing leaders/managers today at they strive to lead their organization toward sustainable growth and profitablity.

The key question is: "How can I gain a broad perspective that allows me to confidently make major decisions confidently maintaining proper balance between opportunity and risk?”

A lot of companies will tell you that they are fully aware of their critical risks. Unfortunately experience has shown that this is not the case. In fact, a lot of corporate failures are the results of risks that were not identified and hence not properly taken into account and managed because they were not ‘visible’ enough.

What if your company’s major business risks, obstacles to strategic objectives, and vulnerabilities could be depicted on one or two pages in a concise manner for review of executive management and members of the board?

What if a few additional pages could communicate details of these risks, as well as specific actions to mitigate or eliminate them, time frames for implementation, measurements of success, and the management executive responsible for successful implementation?

What if you were assigned the responsibility of developing this information and presenting it to the senior management or the board within the next 30 days?

The company that manages its risks more efficiently than its rivals has a distinct competitive advantage. A risk map/risk profile is an effective solution. This module workshop will introduce you to risk mapping, highlights the benefits, summarizes one method of developing risk maps, and describes several applications, some pretty unconventional, for risk mapping in an organization.

Module Topics includes

• Discover the nature of an organization as a complex system. Understand how risks interact with the system
• Understand how risks affect and uncertainty affect Decision-making the value creation process
• Effective methodologies and tools for identification and analysis of risks across an enterprise
• Analysis the relationship between risk perception and reality
• What are the methods of analysis (Statistical analysis, decision trees, fault trees and event trees, scenario simulation and analysis, game theory, dephli, voting methods, etc.)
• Dimension of Risks: Level of risk, uncertainty, variability, time horizon, etc
•  “Linear” vs "Systems thinking" approach to risk management
• Utilize a comprehensive risk mapping tool kit
• Understand your business objectives and environment: Defining the key risks/opportunities
• Principles and steps of Risk portfolio profiling and mapping
• Consequence and likelihood tables & Risk Maps. Tolerable risk and Risk Appetite
• Risk Register and documentation of the analysis

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Learn the key Techniques to Protect Your Tangible and Intangible Assets and Enhance Value Creation for your Organization

In today's global and volatile Risks are waiting to happen. It is the nature of life. And when they do, we should be prepared to minimize their adverse impacts and possibly leverage on the opportunities they create. These accidents could be a major fire, a change of regulation, a chemical spillage, the entry of a new competitor, an explosion or a fraud committed by a senior manager. Whether you are working for a commercial corporation or not-for-profit organization, all entities have a business, legal and often moral responsibilities to deal with risks in an effective and appropriate manner.

Besides protecting physical assets and human lives, organizations are becoming more concerned about protecting intangible assets as well. Intangible assets include intellectual property, product brands and corporate reputation.

This workshop provides an understanding on the types of losses an organization is exposed to. Participants will learn the Key Risk Controls Techniques to protect both your tangible and intangible assets. How and when to select and apply the right risk control measures and what  are the typical mistakes in selecting and implementing less effective control measures. Importance of understanding the concept of acceptable risk / risk tolerance..

This Workshop will guide you through a wide range of risk management control strategies/interventions, explains how they work, and suggests when they are most appropriate.

Workshop Content

• Understanding what is Risk Control and it importance to an organization
• Understanding what are your tangible and intangible assets
• Major causes of loss affecting property, people, reputation, etc
• Major categories of losses/opportunities i.e. Strategic, operational, financial, etc
• How to organize the systematic management of the triggers/factors that give rise from a risk issue to and incident and finally a crisis.
• Learn the techniques to prevent and/or reduce the impact of losses and when to use them effectively?
• When and how to prepare for crisis with appropriate contingency and business continuity management
• And many more..

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In today's global and volatile Risks are waiting to happen. It is the nature of life. And when they do, we should be prepared to minimize their adverse impacts and possibly leverage on the opportunities they create. These accidents could be a major fire, a change of regulation, a chemical spillage, the entry of a new competitor, an explosion or a fraud committed by a senior manager. Whether you are working for a commercial corporation or not-for-profit organization, all entities have a business, legal and often moral responsibilities to deal with risks in an effective and appropriate manner.

Besides protecting physical assets and human lives, organizations are becoming more concerned about protecting intangible assets as well. Intangible assets include intellectual property, product brands and corporate reputation.

This workshop provides an detailed understanding on the wide range and types of losses an organization is exposed to and the potential financial impacts of those losses. Participants will learn the Key Risk Financing Techniques to Protect Your Tangible and Intangible Assets. How and when to select and apply the right risk financing Techniques and how to analyze carefully the pros and cons associated with the financing techniques of transfer, retention and insurance.

This Workshop in summary will guide you through a wide range of risk financing strategies, explains how they work, and suggests when they are most appropriate in wide range of specific scenarios.

Workshop Content

• Understanding the role and importance of Risk Financing in the overall context of the management of Risk in an organization
• Learn the key risk financing goals from paying for losses to liquidity, compliance requirements, uncertainty management, etc.
• Understanding the major types of losses/opportunities i.e. Strategic, operational, financial, etc and how loss characteristics affect risk financing technique selection.
• Analyzing the impact of risks, crises and losses on your organization’s balance sheet, Profit and Loss, and cash flows
• Understanding the concept of acceptable risk / risk tolerance both terms of perception and financial capability.
• What are the techniques to prevent and/or reduce the impact of losses and when to use them effectively?
• Effective methods of risk financing to ensure the firm is able to bear the financial consequences of loss events How in addition, to increase performance by optimizing the risk/return balance with proper capital allocation and risk financing
• How to structure an effective insurance, How and when to use captives, bonds and other financial risk transfer mechanisms
• And more…

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Managers and executives at all levels of the organisation have to manage small crises on an ongoing basis. However, their skills are tested to the utmost when they are faced with major crises that have the potential to disrupt the organisation's income sources, operating expenses, stock price, competitive position and ongoing business.

Disasters may strike an organisation when least expected. Recent events such as the terrorist attack on the World Trade Center in New York City, the Bali bombing and SARS/Bird flu outbreaks have alerted organisations to the adverse impact a disaster can have on their business. Have you ever considered, given the above scenarios, how would your business be able to carry on with minimum disruption to your operations? What about your brand equity, shareholder value and market share? Would these be affected? How do you reduce your organisation's vulnerability to terrorism, pandemic flu, computer virus assaults, technological changes, customer lawsuit or your own employee's dishonesty?

This module emphasises realistic problem solving and the importance of hands-on experience in preventing or controlling crisis situations. Participants work on exercises based on actual business crisis events. This workshop will teach you how to recognise the threats that your organisation faces, how to develop and respond to any crisis and how to establish a business continuity management programme.

Module Topics includes

1. Roadmap for Crisis Management

• Recent disasters and consequences
• Defining and identifying a crisis
• Planning for crisis management
• Building the team and mechanism for crisis management
• Recognising the early warning signals
• Managing in a crisis situation
• Recovering from a crisis situation
• Crisis Management, Crisis Communication and Business Continuity Management

 
2. Crisis Communication

• The Goals of Crisis Communication
• Covello’s 7 rules of risk communication
• The crisis communication strategy:  Taking into account qualitative risk dimensions and heuristics
• The role of media in the social amplification of risk
•  Stakeholders & Reputation Management

3. Business Impact Analysis

• What are the impacts from a disaster?
• Financial loss, reputational damage & regulatory effects

3. Risk Analysis

• How do you identify potential threats and risks to your organisation
• Fraud, business risk, project risk etc.

4. Business Continuity & Recovery strategies

• Alternative strategies
• In-house vs. outsourcing

5. Effective use of Training and implementation

• Setting up Business Continuity teams
• Developing training courses
• Implementing the plan with the BC teams

6. Maintenance, evaluation and audit of existing plans

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Fraud, Terrorism, technological changes, increasing competion, CSR, business changes, etc. Do you know what is in the “pipeline” for your organisation? Even if you have a whole risk management system in place, will you really be able to really  recognise, monitor and take actions on risks/threats and opportunities as and when they occur? Past corporate disasters shows that organisations are often not good monitoring risk issues.  

So when risks materialise; disasters may strike an organisation when least expected; management will fall in to the trap of reactive firefighting.

Furthermore even if your Risk Management system is working well, managers should not be insensitive to the possibility that the risks may have changed and therefore their assessments may be in need of update. The Risk Management process of identification, assessment, analysis, and developing effective management interventions, is a continuous ongoing process of response to changes in the strategic and operational exposures. Leaders and Risk managers should learn to recognise any structural changes that could make their existing models and loss data less relevant or even obsolete.

Understanding the status of the entire risk control system at different times requires a systematic monitoring and reporting structure. Bill Gates, the former CEO of Microsoft, described risk management as “information management: getting the right information to the right people at the right time“

This module workshop will explore the two dynamic processes of strategic/operational response and continuous change learning that are critical for an effective risk control system and explain how they can be explicitly structured and monitored using a series of reports and Key Risk Indicators (KRIs) and distributed timely to the people who need them to make the right decisions.

Module Topics includes

• What are the critical components of an effective risk metric dashboard?
• Monitoring and review: How to design and set the KRI/KPI
• Understand the continuous changes in context and risks
• What are some common pitfalls in risk reporting that your organisation should avoid?
• How should risk information be communicated to the board?
• Connecting Risk management with audit (assurance) and monitoring processes
• How to Develop Risk Management performance measurement
• How to recognise factors leading to crisis for timely intervention
• And many more

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