Risk Management 7 Step Process
Enterprise Risk Management is defined as “the process of identifying and analyzing risk from an integrated, company-wide perspective. It is a structured and disciplined approach in aligning strategy, processes, people, technology and knowledge with a purpose of evaluating and managing the uncertainties the enterprise faces as it creates value” (Woon, Azizan, & Samad, 2011, p. 23).
Had Non-Linear Pro utilized Enterprise Risk Management, the company would have been able to reduce their liability exposure. Quick Takes Video is in the position of having a legitimate claim against Non-Linear Pro for breach of warranty. The salesman informed Hal that his employees would be able to operate the software in one to two days. After two weeks of attempting to utilize Non-Linear Pro’s product, Hal’s employees have come to the conclusion that the product cannot perform as promised. They state that the program has insufficient memory, and can only edit 5 minutes of high definition video at a time. Additionally, it does not appear that the difficulties with Non-Linear Pro are simply the result of the limits of available technology. Hal’s employees mention a competing program used by other companies which appears to far outperform Non-Linear Pro. This further strengthens Quick Takes’ potential claim for breach of warranty. Although it is reasonable that there will be differences between competitors’ products such as features and the abilities of software, it is also reasonable to assume that the product will be able to perform the necessary functions it was designed for, in this case, editing video.
The 7 steps of Enterprise Risk Management are: 1) Management commitment 2) Communication and consultation 3) Policies and procedures 4) Training and education 5) Effective and efficient framework 6) Risk Management is applied in practice 7) Ongoing monitoring and review
(Harb, 2008)
Management Commitment: If Non-Linear Pro is going to
Had Non-Linear Pro utilized Enterprise Risk Management, the company would have been able to reduce their liability exposure. Quick Takes Video is in the position of having a legitimate claim against Non-Linear Pro for breach of warranty. The salesman informed Hal that his employees would be able to operate the software in one to two days. After two weeks of attempting to utilize Non-Linear Pro’s product, Hal’s employees have come to the conclusion that the product cannot perform as promised. They state that the program has insufficient memory, and can only edit 5 minutes of high definition video at a time. Additionally, it does not appear that the difficulties with Non-Linear Pro are simply the result of the limits of available technology. Hal’s employees mention a competing program used by other companies which appears to far outperform Non-Linear Pro. This further strengthens Quick Takes’ potential claim for breach of warranty. Although it is reasonable that there will be differences between competitors’ products such as features and the abilities of software, it is also reasonable to assume that the product will be able to perform the necessary functions it was designed for, in this case, editing video.
The 7 steps of Enterprise Risk Management are: 1) Management commitment 2) Communication and consultation 3) Policies and procedures 4) Training and education 5) Effective and efficient framework 6) Risk Management is applied in practice 7) Ongoing monitoring and review
(Harb, 2008)
Management Commitment: If Non-Linear Pro is going to
References: (I used the Phoenix reference generator for the citation for the Harb article, but I’m not sure it’s correct. Take a look, and if you think I should modify it, just let me know). I used the other citation for the definition of ERM. Feel free to use it, but don’t feel obligated. Wanted to make sure we are good on our citations, and liked that it seems to be a good definition from a peer-reviewed article. Harb, T. (2008). 7 essential elements of enterprise risk management and the roles of internal audit. Retrieved from Harb, T., LAW531 - Business Law website. Woon, L.F., Azizan, N.A., & Samad, M.F.A. (2011, January). A strategic framework for value enhancing enterprise risk management. Journal of Global Business and Economics, 2(1), 23-47. http://ehis.ebscohost.com/eds/pdfviewer/pdfviewer?sid=12d001be-743f-4627-b9f5-d1a3467582d9%40sessionmgr110&vid=2&hid=109.