Enterprise risk management, the new imperative

- By: ,

Courtesy of Lexicon Systems, LLC

Enterprise Risk Management (ERM) is a new, strategic imperative that is gaining momentum. Leaner operating models and global sourcing have made companies stand up and take notice: managing risk is important! And Health, Safety and Environment (HSE) risk is no exception. According to AMR Research, nearly half of surveyed companies plan to increase spending on Operational Risk Management initiatives in 2007. Organizations that effectively manage risks become more agile.

Organizations are starting to see the value of, and asking for, strategic solutions like integrated ERM software. However, the software market often suffers from the “alphabet soup” syndrome—companies implement GRC, BPM (business process management), BI (business intelligence)and EPM (enterprise performance management) platforms, not always understanding how these solutions differ, how they overlap, or how they complement each other. Add HSE to the mix and it adds complexity.

Organizations that reach a certain level of business and information technology maturity can support an Enterprise Risk Management solution. These organizations establish a “risk culture” and gather risk intelligence. They adopt a process focus, not “siloed” issue-by-issue governance, risk and compliance focus. In addition, they establish a risk and compliance architecture that considers business processes, people, and information technology. Finally, they consistently communicate and train the organization on corporate policies and procedures. Information technology enables companies to embrace ERM. Technology aggregates and consolidates data, transforming it into useful information, accessible throughout the organization, provides information transparency, assists in accountability, and helps to identify risks and opportunities for improvement.

Customer comments

No comments were found for Enterprise risk management, the new imperative. Be the first to comment!