Risk Commentary

New website = RiskCommentary.caWhat are the key questions of senior executive in considering the adoption or remediation of enterprise risk management? Answers to these questions form an overview to guide the successful roll-out of ERM. Key questions entertained by the C-suite with regard to ERM likely include these three:a. What exactly is ERM?Due to uneven development in the field, definitions are many. I offer a carefully crafted definition.b. Is there a verifiable value proposition?get clarity on strategic identity and aims; support execution of goals and objectives; analyze and solve business problems.c. How can it be integrated, quickly and efficiently, with existing planning and management?establish sound planning, and use the principles of successful program implementation.An elaboration on these answers is given over the course of the podcast series. Main points:1. Enterprise Risk Management is rational planning.2. Business Continuity and Emergency Planning.3. A multiplicity of definitions. 4. The planning regime. 5. Survey results.6. High Quality Risk Assessment. 7. Principles of program success. 8. Titles and job descriptions. 9. Conceptual hurdles. 10. Scenario analysis and Future Scenarios Planning.11. Prove the value of Enterprise Risk Management.KEY QUOTE”Enterprise Risk Management holds the promise of capturing the entire spectrum of risk across the organization. This book answers the need for a generic ERM methodology, proven by experience in the field, in both public and private sectors.” (Robertson 2016 back cover)LINKS (E. Robertson 2016) Solving the Enterprise Risk Management Puzzle: Secrets to Successful Implementation Blog posts addressing risk tolerance:Risk Tolerance: Non-Finance ExamplesMaking Sense of Risk Tolerance, Risk AppetiteBooks and Courses Consulting Contact

New website = RiskCommentary.caWhat is the “upside” of risk? Does ERM manage opportunity meaningfully? It leads to a structured innovation program that risk managers can lead with confidence. 1. Opportunity - origin of the idea in ERM2. Opportunity - how can we make sense of the idea?3. Opportunity - as innovation4. Innovation  a. an established discipline  b. within the grasp of the risk manager; an expanded role5. Innovation - Free Online Introductory Course 6. Innovation - Paid Course SummaryKEY QUOTE”...risk managers can borrow from the practice of innovation and use a structured method to seek out, evaluate, greenhouse and develop new ideas” (Robertson 2016 p.112)LINKS Risk Commentary podcast books and courses.(E. Robertson 2016) Solving the Enterprise Risk Management Puzzle: Secrets to Successful Implementation Technology implementation - 3-part discussion, LinkedIn audio posts:innovation - successful tech implementation

New website = riskcommentary.ca[Re-edited for clarity.]Due diligence is not the same as risk assessment; they are complementary.Due Diligence and High Quality Risk Assessment: how could they be used?1.  Quote: the hope for a less quantified, more qualified and thoughtful approach.2. Due diligence definition vs risk assessment.3. Order of operations:     a. select using matrix with criteria;     b. conduct risk assessment.4. Maturity matrix definition.5. Thought experiment: due diligence for investment project using maturity matrix.6. Maturity matrix (semi-quantitative analysis) with categories:firm  management teambusiness modeldeal structure7. After d.d scoring, do risk assessment. 8. This proposed method would help the management team.9. “High returns = high risk”. Is it strictly accurate?10. Application of Due Diligence and High Quality Risk Assessment in stages of major projects.Summary KEY QUOTE“The practice of due diligence has evolved into SOX checklists... Best practice awards are given to the weightiest presentations (by the pound) and third part vendors are predominantly selling ‘perfect solutions’ for enterprise risk management that will seriously impede your ability to conduct business.” (L. Burke Files, Due Diligence for the Financial Professional, 2010, p.6)LINKS  Robertson, E. Enterprise Risk Management Tools and Templates, 2016. p. 35 - Enterprise Risk Management maturity matrix, based on Carnegie-Mellon methodology.Mark C. Paulk, Bill Curtis (CAST Research Labs), Mary Beth Chrissis, Charlie Weber Capability Maturity Model for Software (Version 1.1) The original article whose methodology has been borrowed and applied to many aspects of business.

New website = riskcommentary.caERM, for some, consists solely of Financial Risk Management. Is this sound? We offer commentary on quantitative modelling and its place in Enterprise Risk Management.Quantitative methods examplesChief limitations of quantitative modelsProprietary internal risk rating systemsForecasts and probability estimates2008-2009: crisis in risk management methods?Strategy and market risks scuttle the company RecommendationsQuotes from the financial expertsWhat constitutes due diligence?What is the worldview informing the faith in quantitative models?SummaryKEY QUOTES”...a new kind of blindness: the one induced by new technology and elaborate quantitative models.”(B. Voyles ) Voyles and other financial experts mentioned quoted in Robertson, p.98”...much more is being underwritten, correlated, and contemplated [by major insurers] than the traditional hazard risks.”Interview with LoriAnn Lowery-Biggers and Sean Murphy by John Czuba; see EP01.LINKS Blog post: Economic Crisis: Why ERM Did Not FailE. Robertson 2016 Solving the Enterprise Risk Management Puzzle: Secrets to Successful Implementation 

New website = RiskCommentary.caERM mid-life crisis: how to rejuvenate and validate the program.The curious juxtaposition of need vs poor take-up.Steps in analyzing and fixing poor take-up in ERM programs.Several specific fixes for improving the compelling nature of risk information.What about “opportunity”? Ref: Innovation.What about other risk management sub-disciplines?Return to first principles in planning and HQRA.Review again the principles of program success (Ep 15).KEY QUOTE“The result [of High Quality Risk Assessment] is a body of risk information that is fresh and revelatory, leading to problem solving. When that happens at your risk ID session, it is unmistakable. People see the logic of the method and acknowledge that it is working.”LINKS Free introductory course: Innovation: How Can My Organization Get Started?(E. Robertson 2016) Solving the Enterprise Risk Management Puzzle: Secrets to Successful Implementation