Signs of Early Recognition (Part 1)
I've noticed an interesting development emerging from the Middle East. There's a growing appetite for understanding more effective management of risk, even an explicit interest in what folks from that region seemingly understand to be enterprise risk management.
To a risk management leader, innovation should be a continuing strategic goal. Yet the hurdles to innovation are many.
Extreme Risk Management
Just when you thought ERM meant enterprise risk management, I'm here to tell you your focus should be more on extreme risk management; after all, should we really spend our limited and valuable time and resources on the expected when the unexpected is often so much more destructive?
Focus on the Upside of Risk
It's only natural that we want to first do what we can to minimize, if not prevent bad things from happening. After all, no one wants these things to happen if they can be reasonably avoided or controlled.
ERM Alive and Well
As I write this, I'm flying home from two intensely satisfying days at the inaugural RIMS Enterprise Risk Management Conference subtitled, "Where risk meets innovation." As the name would imply, I needed to be there.
A Changing of the Guard
Just as enterprise risk management may be perceived as being on its last legs, in comes risk and performance management. I think of risk and performance management, or RPM, as the correct way in which we should consider risk as it relates to mission accomplishment. I think it is the most natural next step in risk management.
Balancing 'Quants' with 'Qualts'
I like quants, but they often narrow their focus to only numbers, when more insight is needed from other methods. There has been much written since the financial crisis of 2008 about the over reliance on all the risk models that were supposed to have revealed how much risk firms were taking and to somehow enable them to manage their risk appetite more successfully. That mindset about risk modeling and measurement has taken much heat because so many lost so much: investments, pensions, jobs, houses--even lives.
Shifting the Risk Paradigm
If all the risks to your business were known, easily ignored, or cheaply transferred, would you feel better? Unfortunately, such a world does not exist.
Ratings, Risk and Ostriches
The seven days of stock market trading after the Standard & Poor's downgrade of the United State's credit rating was made public was the most volatile in years. After weeks if not months of doomsday predictions of the downgrade's effect, it appears to be one with short-term impact. Or is it?
Requisite Risk Knowledge
You don't hear a lot about innovation in risk management education or training because there doesn't seem to be all that much different being offered, or so some think. Before I address that fallacy, let's consider the importance of this issue.
Are you ready for ETCOR?
Practitioners have been using the Total Cost of Risk as a key metric in the discipline for some time.
Just as the corporate business strategy is central to being able to achieve key goals and ultimately deliver the mission, risk strategy must both assume similar importance.