Strategic Management of Enterprise Risks



Strategic Management of Enterprise Risks

Introduction

The objectives of risk management are to safeguard the shareholder's investments and the company's assets so as to steer the company to the next level of growth whilst operating within the company's risk parameters. Concept of risk management has become significantly important in recent times especially after the recent financial crisis. Importance of Business Continuity Management and Enterprise Wide Risk Management has exponentially increased. Business continuity management has evolved significantly over the recent decades. Twenty to thirty years ago, business continuity management was predominantly focused on IT, including communication and data centres. It was known as IT disaster recovery planning, IT fall back planning, resilience planning and so on. Today, business continuity is concerned with the capability of an organisation to plan for and respond to incidents and business disruptions in order to continue business operations at an acceptable pre-defined level. An incident is defined as a situation that might be, or could lead to, a business disruption, loss, emergency or crisis. This, indeed, is a very broad and almost all encompassing definition.

This paper will address Business Continuity management in terms of its scope, implementation process and the contents of a typical business continuity plan, along with a real-world case. Further it will explain the concept of enterprise-wide risk management (ERM) along with the pros and cons to ERM as an approach to risk management and business continuity management.

Discussion

Business Continuity Management

Business continuity management or planning is the development, implementation and maintenance of policies, frameworks and programs to assist treasury manage a business disruption, as well as build treasury resilience. Resilience comes from tackling the likelihood as well as the consequences of disruptive events. Therefore, it is important to have both effective ORM and business continuity planning frameworks in place. Business continuity planning assists in preventing, preparing for, responding to, managing, and recovering from the impacts of an incident or disruptive event

Business continuity management has evolved significantly over the recent decades. Twenty to thirty years ago, business continuity management was predominantly focused on IT, including communication and data centres. It was known as IT disaster recovery planning, IT fall back planning, resilience planning and so on. Today, business continuity is concerned with the capability of an organisation to plan for and respond to incidents and business disruptions in order to continue business operations at an acceptable pre-defined level. An incident is defined as a situation that might be, or could lead to, a business disruption, loss, emergency or crisis. This, indeed, is a very broad and almost all encompassing definition.

Business continuity management (BCM) has become a crucial discipline for every organization. What originated alongside risk management as a specialist activity in the information technology function has broadened to encompass all aspects of a company's operations. Many organizations increasingly take an enterprise wide view of business continuity and risk management, and consider the impact of disruption on every aspect of their business.

Companies that have put in place effective BCM will be able ...