Enterprise-wide Risk Management

Coming from a crisis management and business continuity background, I really enjoyed reading Enterprise-wide Risk Management: Strategies for linking risk and opportunity by DeLoach has a refreshing new approach to risk management that is is cross-functional, integrated and adaptable in the face of constant change, simply because traditional risk management approaches are no longer adequate in today’s rapidly changing world in where traditional risk management is too fragmented and function-driven.

The evolution of risk management

deloach-risk-managementThere are many excellent and self-explaining illustrations in this book, but the one that fascinated me the most is the one to the left, showing how enterprise-wide risk management is the perfection of risk management in business, enterprise risk management is seen as a natural evolution of operational risk management into a strategic process, with clear linkage to business opportunities, and with the purpose to align strategy, processes, people, technology and knowledge on an enterprise-wide basis.

Four plus Two equals Six

Classic risk management literature acknowledges four ways of dealing with risk after establishing a risk matrix:  Avoid, Reduce, Transfer and Retain or Accept. As it turns out, there are six ways, not just four ways to deal with risk.  Two more are Exploit and Ignore. DeLoach points at exploit, while Tomlin (2006) points at Ignore, as I discuss in my later post on The six ways of dealing with Risk. And, ‘Exploit’ also makes into a discussion on risk management as a core competence by Lessard and Lucea (2009).



Reference

De Loach, J. W. (2000). Enterprise-wide Risk Management: Strategies for linking risk and opportunity. London: Financial Times/Prentice Hall.
Copyright note: The image used in this post is taken from the above book.

Author link

Buy this book

Related

Posted in BOOKS and BOOK CHAPTERS
Tags: , , , , ,

ARTICLES and PAPERS
Call for Papers: Global Supply Chain Risk
Supply chain risk seems to be a topic making the rounds in the academic journals these days, and tod[...]
Corporate vulnerability
Göran Svensson is one of the leading key figures in supply chain vulnerability research and his conc[...]
BOOKS and BOOK CHAPTERS
Book Review: Enterprise SCM
Have you ever played SimCity? I never liked Transport Tycoon that much, but I used to play SimCity a[...]
Book Review: HBR on Crisis Management
Close calls and near misses are not unusual in the business world, but how do companies deal with th[...]
REPORTS and WHITEPAPERS
Global Resilience Index
The 2015 FM Global Resilience Index provides an annual ranking of 130 countries and territories acco[...]
Stemming the rising tide
Are you are taking radically different actions than your peers when it comes to supply chain risk ma[...]