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A Broader Vision of Risk

Recognizing that dynamic financial, business and political forces are changing the nature of business and risk management, ABS Consulting is offering an integrated and robustly analytical approach to Enterprise Risk Management (ERM). Linking the understanding of risk with better financial and operational decision-making, our ERM consulting team focuses on assisting clients to develop appropriate risk frameworks, use focused risk analytics and processes to create and implement comprehensive risk-adjusted solutions. The goal of the Enterprise Risk Management approach is to promote economic growth, better utilization of capital resources and competitive advantage.

In our view, ERM is not an entirely new initiative because organizations already manage some risks in “silos”. Rather, ERM is the maturation of the successful management of risk in “silos” into an inclusive, integrated approach. ERM is a process, unique to an organization; not a product or bundle of solutions.

The objective of employing an ERM approach to evaluate the organization’s risk profile would be to assist the company to better understand and exploit its risk profile in order to create a sustainable competitive advantage. A key focus would be to use ERM to calibrate and align the company’s risk profile with its risk management processes and strategic finance and operational goals.

The types of questions that are answered using our ERM approach might include:

  • How should the company define risk?
  • What metrics should the company employ to measure risk?
  • What are the company’s material risks?
  • How frequently could these risks occur?
  • What is the economic severity of these risks over time?
  • What are the interrelationships between the various material risks?
  • When assembled in a portfolio, what is the aggregate risk to the company?
  • What are the company’s current risk mitigation methods and are they effective?
  • Is the company’s risk portfolio contributing to, or detracting from, the company’s economic and operational strategy?
  • What elements of the company’s risk portfolio represent an opportunity for the company to achieve sustainable competitive advantage or increase customer service value?

How do you start on the ERM journey?

Our approach to ERM is to not bill it as a new initiative because your organization already manages some risks, albeit in “silos”. Instead ERM ought to leverage and build on past successes – view it as the maturation of the successful management of risk in “silos” into an inclusive, integrated approach that is uniquely shaped to suit your organization.

We recommend an Envisioning Process as the first step on your organization’s ERM journey. The envisioning process delivers a preliminary risk profile for your organization and a clear plan for the rest of the ERM journey.

The central activity of the Envisioning Process is a workshop where the proper risk constituencies of your organization are represented. At the workshop, the representatives:

  • Calibrate their thinking with respect to risk, risk management, and ERM
  • Clarify definitions of risk and risk metrics
  • Work through a preliminary mapping of risks that were gathered from them individually before the workshop
  • Create a framework within which your organization can move forward with ERM according to a high-level plan.

Completing the Envisioning Process with our facilitation and expert guidance will result in several significant accomplishments by your organization:

  • A preliminary risk assessment, validated by your risk constituencies, presenting the key risk issues at your organization.
  • A summary of current risk management activities in your organization and how they fit into an ERM framework.
  • Consensus among your risk constituencies about what is required for ERM at your organization.
  • A high-level plan by your risk constituents for your organization to move forward on the ERM journey.

RFactor can assist your ERM journey:

  • Facilitate the envisioning process.
  • Advance an ERM approach, tailored to your organization, which is likely to be successful and meaningful.
  • Help your business units develop and practice their own forms of risk management in accordance with your overall ERM objectives and beliefs.
  • Provide ERM-related software systems and enabling technology.
  • Provide training in risk management capabilities and best practices.

Why choose RFACTOR?

Our focus is on knowledge transfer. Rather than do work for clients, we communicate the expertise to them so they can do it themselves. This focus on knowledge transfer has key advantages:

  • It empowers your people.
  • It minimizes our involvement, which minimizes your cost.
  • There are no "black box" services ... we make sure you understand everything.

We have the risk management expertise:

  • Leading-edge methodologies, tools, and models that are continually being improved,
  • Scientific, engineering and management consulting experts for risk identification, assessment and mitigation,
  • Experience gained from addressing a variety of risks and risk management challenges in a broad spectrum of industries and public sector organizations, and,
  • Training seminars to teach the methodologies, tools and modeling techniques to clients.

We can integrate systems, software and services to provide a rationale for effective decision-making. We can implement a sustainable risk management capability, infrastructure and training to enable your organization to execute its enterprise risk management strategies.

At RFactor, we take pride in our commitment to our clients: quality, service and knowledge transfer. As your risk management consultant, our goal is to exceed your expectations, not just meet them.

We believe our specific capabilities and experience, as well as our independence, make RFactor a uniquely valuable partner for your organization.

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