How do we allocate time to manage risk ? - 'Resource Response Time'

Résumé du document

How do we allocate time to manage risk? Risk management began in companies through the evaluation of insurance. It has evolved through time, evolved till it emerged as what is now called Enterprise Risk Management. This is now described as a real competitive advantage for a company to handle its internal and external environment, to prevent from difficulties, and be more valuable. It is, above all a great advantage for shareholders thanks to the discipline built around the risk/ return's notion. With the risk management practice have appeared the regulatory organizations. These organisms define the framework of how risk management could be applied in companies in many domains like the financial one. ERM has now evolved into a very specific discipline and can be analyzed through different point of view. The first among these are its objectives, which focus the application of the risk management to reach the appropriate results for the company. There are also eight other components that are described as part of the enterprise risk management process.

Extraits

[...] ERM optimizes business performance by supporting and influencing pricing, resource allocation, and other business decisions. The results of an ERM strategy which is pursued on the long term objectives is that Policyholder and stakeholder will have confidence in the company's ability to meet future obligations and are less likely to lapse. Nevertheless, five factors could influence and endanger the quality that such method could give the company and these ones are described as the limitations of ERM Limitations of ERM; five factors influence the quality of ERM The human judgment could be a brake to the implementation of ERM. [...]

[...] This schedules for every person in charge of a project the time plan allocated to a specific task. This enables the people included in the network to have access to the global organization for a better understanding of the global process. We can see that the schedule is very clear but that the interrelation of the people's tasks misses. Without clear explanation that means team meeting or an attached document, this is impossible for people to understand the interrelations or the global organization of the project. [...]

[...] This is more specifically group sculpture project. As you can see, the tasks have been divided in 7 stages: the the the glaze”, the “sculpt chair”, “sculpt and the final task These are the tasks represented on the vertical axis and on the horizontal axis the time is divided by week: from 1 to 5. Each colour of the bars is attributed to a person, member of the project. Diane NEVEU SUP5 1B -Risk Management II- Dr. James KALLMAN July The weekly Gantt chart This other example of GANTT chart clearly shows the evolution of the process of each tasks. [...]

[...] Who is authorised to declare an event? What event has being measured? How an event is identified or an example of what an event looks like? How the severity of an event is categorized “heightened awareness” or “crisis level”? What actions and steps are to be taken? Who is to be notified? What reporting is needed? 4.2 Organizational objectives for pursuing ERM Once the ERM is set up through the business, the company and managers have to maintain it at its best level for their effort to be efficient on the long term and for the ERM to stay a competitive advantage and not to begin a one more procedure. [...]

[...] Following its category of objectives, the ERM is made of eight components. Diane NEVEU SUP5 1B -Risk Management II- Dr. James KALLMAN July The eight components The Internal environment The internal environment is the context within which the enterprise functions. The organization's reporting structure, assignment of authority, development of personnel, risk appetite, management style and ethical values are key elements of the internal environment. This foundation and culture set the course for how risk will be handled across the enterprise; the independence and involvement of the board of directors and the tone set by management have a critical influence on the internal environment. [...]