Expecting more from risk management
Insights on governance, risk and compliance
May 2014
Expecting more from risk management
Drive business results through harnessing uncertainty
Contents
Introduction ............................................................... 1
Risk, uncertainty and business performance ................... 2
Rhythm of the business ................................................ 5
A program for developing risk-enabled performance management .................................................................. 9
Conclusion ................................................................. 15
Introduction
In an increasingly complex, competitive and fast-paced world, organizations need to continually advance their risk management practices, building on the strong foundation of protection and compliance into an expanded focus on risk factors that impact strategic decision-making and operational performance.
Organizations have invested significant sums of money to change their business models to take maximum advantage of today’s global business environment. They have developed new products, new operating practices and new concepts in service delivery to enhance business performance. Using big data and analytics, organizations can optimize their performance and grow their business in ways they had never before thought possible.
But amid this world of change, many organizations continue to operate using risk management programs that have not evolved and may not protect them from today’s risks. For a large number of global organizations, risk management is still seen as only a high-level compliance exercise to educate the board and audit committee; as a result, there are often no clear lines of sight from the boardroom to the operations themselves.
To be sure, monitoring and compliance are critical for a healthy organization, but significant additional benefit lies in connecting risk management to profit and loss and/or cash flow — two areas
that
May 2014
Expecting more from risk management
Drive business results through harnessing uncertainty
Contents
Introduction ............................................................... 1
Risk, uncertainty and business performance ................... 2
Rhythm of the business ................................................ 5
A program for developing risk-enabled performance management .................................................................. 9
Conclusion ................................................................. 15
Introduction
In an increasingly complex, competitive and fast-paced world, organizations need to continually advance their risk management practices, building on the strong foundation of protection and compliance into an expanded focus on risk factors that impact strategic decision-making and operational performance.
Organizations have invested significant sums of money to change their business models to take maximum advantage of today’s global business environment. They have developed new products, new operating practices and new concepts in service delivery to enhance business performance. Using big data and analytics, organizations can optimize their performance and grow their business in ways they had never before thought possible.
But amid this world of change, many organizations continue to operate using risk management programs that have not evolved and may not protect them from today’s risks. For a large number of global organizations, risk management is still seen as only a high-level compliance exercise to educate the board and audit committee; as a result, there are often no clear lines of sight from the boardroom to the operations themselves.
To be sure, monitoring and compliance are critical for a healthy organization, but significant additional benefit lies in connecting risk management to profit and loss and/or cash flow — two areas
that