RSS FeedBy M. Isi Eromosele
Business is all about taking risks. Risk management aims not to eliminate disadvantage risk, but to control it at a satisfactory level. The salient reason for risk management is to establish, defend and improve a company’s value through the management of inherent uncertainties that could positively or negatively affect the attainment of the firm’s business objectives.
This often requires the establishment of an Enterprise Risk Management system.
As an organization grows in complexity as it serves manifold markets, it is faced with the challenge of fully understanding how its multiple business units interrelate with one another and as such, how business risk cuts across them.
Rather than managing risk within separate units, effectual risk management needs a holistic approach. The components of an advanced risk management program include:
- Concentrating on opportunities, obstructions and threats wholesomely
- Measuring the possible effect of recognized threats
- Ensuring risk clever decisions
- Enabling the firm to pursue opportunities while tackling obstructions and threats
In formulating an overall strategy on enterprise risk management, most organizations are confronted with the challenge of balancing two opposing goals: Set up a universal approach and put into effect a system for quantification, analysis and reporting of risk or sustain each business unit as they set up individual risk management rules for their respective areas.
In other words, organizations need to delineate between the needs of the entire firm and those of the individual business units.
At Oseme Finance, our recommended approach to designing a risk management solution is to deliver a flexible platform that would support enterprise-wide processes and requirements, while also concurrently meeting the specific risk management requirements of individual business units.
These diverse requirements are met through the creation of a common risk management base with robust capabilities, including risk and control management as well as incident and issue management. This solution will leverage a universal set of implements for audit planning and scheduling, risk assessments and surveys.
This unique platform methodology enables shared rules, work re-use, effectiveness and cost savings, while specifically supporting the unique needs, processes, information as well as security requirements of each respective business unit.
The unique platform and proprietary built modules will support specific initiatives within the firm, ensuring that each business unit can reconfigure these modules to fit their needs. This avoids the imposition of a one-size-fits-all approach that could reduce the value of specialized processes developed for individual risk requirements.
The major payoff for a firm in adopting a wholesome approach to risk management is the ability to discover the interdependence among the various risks inherent within the various business units that make up the firm. In the absence of such discovery, the firm would implement mitigating steps that could be based on false information and analysis.
M. Isi Eromosele is the President | Chief Executive Officer | Executive Creative Director of Oseme Group - Oseme Creative | Oseme Consulting | Oseme Finance
Copyright Control © 2011 Oseme Group
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