LMS 540 – Risk Management Seminar

LMS 540 – Risk Management Seminar

The past was once the future

We really don’t understand risk. This is, in part, due to the fact that there is
no really universally accepted definition of risk. This results in a risk silos,
compartmentalizing the analysis of risk along professional competency lines
(operational, financial, underwriting, etc.). The net result is that risk is not
comprehended consistently due to the self imposed limitations of our
understanding of what risk constitutes.

Overview:

This seminar explores the emerging practice of “Enterprise Risk

Management” (ERM) – a relatively recent trend in management’s outlook on
identifying and managing risk. Enterprise Risk Management seeks to
identify, analyze, categorize and determine potential consequences of risk
realization under an integrated and unified framework. Traditionally, risk
has been managed in the compartments of tactical exposure (mainly day to
day risk exposures faced by individual operating elements, such as
production facilities), operational exposure (mainly business unit, division or
lines of business operations, etc) and strategic exposure (primarily focused
on financial risk, credit risk and insurability). Instead of allowing identified
risks to remain in such “silos,” ERM seeks to bring these exposures together
under a single model of risk management. ERM is an evolving field with
models that require significant refinement to facilitate consistent and
meaningful risk management.

The seminar begins by developing a definition for risk that can be broadly
applied vertically and horizontally in an organization and its value chain
touchpoints. We will consider global risks that constitute the “spectrum of
risk” faced by all enterprises, whether they are private sector or public
sector entities. With a universal concept of risk we will then turn to an
analysis of an ERM framework that can be applied at all levels within an
enterprise. As we will see, the emergence of the Chief Risk Officer (CRO) is
a critical part of ERM. We then turn to currently recognized risks and
develop a methodology to bring these dimensions of risk into an ERM
framework.

Throughout the seminar, we will keep in view the broadest dimensions of

risk; developing the capacity for the ERM framework to readily expand to
encompass emergent risk that may not be readily recognized by the
enterprise.

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Copyright 2008, all rights reserved, Logical Management Systems, Corp.
 LMS 540 – Risk Management Seminar

Objectives:

Business is inherently risky. It is well established that the optimal balance

between risk and return is imperative for business management. When you
have completed this seminar you should be able to:

 Explain the concept of risk and risk management and be

familiarized with basic concepts and terminology.
 Describe the range of risks that enterprises are facing.
 Understand how and why risk management needs to be
incorporated into all business decision making and planning.
 Understand the concepts of “Active Analysis” and “Futureproofing.”
 Apply effective tools for identifying, assessing and quantifying risk.
 Develop and implement appropriate risk management strategies.

Topics:

 Introduction to Risk: How it applies to your enterprise

 The different dimensions of risk
 ERM definition and conceptual framework
 The nature of risk management activities
 Introduction to Critical Thinking concepts
 Identifying and assessing risks an enterprise faces (e.g. Strategic,
Operational, Tactical)
 Risk Analysis (“Active Analysis,” LMSCARVERRtm, SWOT analysis,
etc.)
 Methods, resources, techniques and strategies for managing risks
 Risk analysis: Human Capital – executive management, key staff,
corporate ethics, employment related liability
 Introduction to Strategic Risk Management
 Risk analysis: managing international risks
 Introduction to Economic Risk Management
 Understanding the Risk Continuum
 Integrating risk types and further discussion of risk exposures
 Case Study – Biofuels Power Corporation
 A World of Risks and Opportunities – World Economic Forum, Global
Risks 2008
 Risk Enablers – Actions and Inactions; Risk Mitigators – Motivators;
Risk Realization – Negative; Taking Advantage of Risk – Positive
 Decision Points – Decision Rights = Latency Factors
 Communicating Risk – When to Wait – When not to Wait –
Overcoming Risk Paralysis
 The impact of regulatory initiatives and guidelines

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Copyright 2008, all rights reserved, Logical Management Systems, Corp.