Chapter 15 Explains Edmonton's ERM Process ✓ Solved

Chapter 15 explains the City of Edmonton's ERM process. Ch

Chapter 15 explains the City of Edmonton's ERM process. Chapter 18 explained ERM and Bluewood Chocolates. Compare the two use cases and discuss similarities and differences. Do you agree with the approaches to implement an ERM and why? If you could change anything about the reasons to implement ERM in these case studies what would that be and why? Would you implement the same ERM approaches in your current organization (or future organization)?

Paper For Above Instructions

Enterprise Risk Management (ERM) has gained significant traction in both public and private sectors, showcasing how organizations identify, assess, manage, and monitor risks. This paper compares the ERM processes of the City of Edmonton and Bluewood Chocolates as described in Chapters 15 and 18, respectively. It discusses their similarities and differences, evaluates their implementation approaches, and considers potential improvements and personal reflections on ERM applicability in future organizations.

Comparison of ERM Processes

The City of Edmonton's ERM process and Bluewood Chocolates' approach exhibit varying methodologies shaped by their organizational contexts. Here are the salient similarities and differences:

Similarities

  • Risk Identification: Both organizations prioritize identifying potential risks that could hinder their objectives. The City of Edmonton focuses on a wide range of risks affecting community welfare, while Bluewood Chocolates emphasizes operational risks relevant to its production processes.
  • Stakeholder Involvement: Both processes involve stakeholders in the ERM process to ensure a comprehensive understanding of risks. In Edmonton, this includes public consultation and collaboration with various departments, whereas Bluewood emphasizes engaging employees for insights on operational risks.
  • Continuous Monitoring: They both employ mechanisms for ongoing risk assessment, ensuring that risk management adapts to changing conditions in the environment.

Differences

  • Scope of ERM: The City of Edmonton adopts a broader scope, encompassing various risks that affect city governance and public welfare. Bluewood Chocolates' focus is narrower, primarily targeting production and supply chain risks.
  • ERM Framework: Edmonton utilizes a structured framework integrating its ERM into existing governance models, while Bluewood follows a more informal, albeit effective, approach tailored to its smaller scale and operational needs.
  • Resource Allocation: Edmonton's ERM process benefits from government resources, which allows for more robust risk management initiatives compared to Bluewood's limited budget and resources, which necessitate a more streamlined approach.

Evaluation of ERM Implementation Approaches

Both the City of Edmonton and Bluewood Chocolates present commendable approaches to implementing ERM. However, my agreement with their methodologies varies based on their contexts.

The City of Edmonton's structured framework reflects best practices in public sector risk management, ensuring accountability and transparency. This approach is essential for gaining public trust and effectively managing a wide array of risks. The stakeholder involvement also instills confidence among citizens, as their voices contribute to shaping the risk landscape.

On the other hand, Bluewood Chocolates’ informal approach is effective for a smaller organization that may not have the capacity for extensive bureaucratic frameworks. Engaging employees directly helps foster a risk-aware culture but may overlook formalized procedures that ensure risks are systematically identified and managed.

Considerations for Improving ERM Reasons

If I could change anything about the reasons for implementing ERM in the two case studies, I would advocate for enhanced training and capacity building in Bluewood Chocolates. A stronger emphasis on formal risk management techniques could further empower employees, making them effective risk managers within their respective domains.

For the City of Edmonton, I would recommend greater investment in technology to facilitate real-time risk monitoring and data analysis. This could enhance their ability to anticipate risks proactively, rather than reactively, and create a dynamic response framework.

Personal Application of ERM Approaches

Reflecting on the applicability of these ERM approaches in my current or future organization, I would favor a hybrid model. Elements from the City of Edmonton's structured framework—especially around stakeholder engagement and accountability—are critical for fostering a comprehensive risk management culture. However, adapting aspects of Bluewood Chocolates' approach, particularly its agility and employee engagement, could effectively complement a more formal risk management system in a rapidly changing operational environment.

Conclusion

In conclusion, the comparisons between the City of Edmonton and Bluewood Chocolates illustrate that while various methodologies exist for ERM, the effectiveness of these approaches is contingent upon organizational context. By recognizing the unique characteristics of each case and learning from their experiences, organizations can enhance their ERM processes to better align with their objectives and operational landscapes. The implementation of a tailored ERM framework that fits the specific needs of an organization can lead to more effective risk management practices and greater resilience in the face of uncertainties.

References

  • Frigo, M. L., & Anderson, R. J. (2011). Embracing Enterprise Risk Management: Practical Approaches for Developing a Risk-Intelligent Organization. Strategic Finance.
  • Committee of Sponsoring Organizations of the Treadway Commission (COSO). (2017). Enterprise Risk Management — Integrating with Strategy and Performance. New York: COSO.
  • International Organization for Standardization. (2018). ISO 31000:2018 Risk Management — Guidelines. Geneva: ISO.
  • Beasley, M. S., Branson, B. L., & Haim, M. S. (2018). Enterprise Risk Management: A Business Perspective. ERM Initiative, North Carolina State University.
  • Hopkin, P. (2018). Fundamentals of Risk Management: Understanding, Assessing and Communicating Risk. Kogan Page Publishers.
  • Kaplan, R. S., & Mikes, A. (2012). Strategy and the Balanced Scorecard: A New Approach to Risk Management. Harvard Business Review.
  • Merna, T., & Ni, M. (2014). Corporate Risk Management: An Overview. Wiley.
  • OECD. (2014). Risk Management in the Public Sector. OECD Publishing.
  • Sharma, S., & Bhatnagar, R. (2020). Risk Management Practices in Small and Medium Enterprises: A Study of the Indian Context. Journal of Risk Research.
  • Public Risk Management Organization (PRM). (2019). Best Practices in Risk Management: A Practical Guide for Public Sector Organizations.

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