Erm At Mars Incorporated For Strategy And Operations

Erm At Mars Incorporated Erm For Strategy And Operations The Major

ERM at Mars, Incorporated. ERM for Strategy and Operations - the major principles for the design of an ERM process that were discerned by Senior Management at Mars. From your reading of the case study report select two principles and provide your analysis of how the principles were applied to the case study, External research should be used and applied to this case study to support opinions. Cite any research using APA format showing use in your text with in-text citations along with full reference citations.

Paper For Above instruction

Enterprise Risk Management (ERM) is an essential framework that organizations adopt to identify, assess, and mitigate risks that could potentially hinder their strategic objectives. At Mars, Incorporated, senior management discerns specific principles that underpin their ERM process, particularly tailored to enhance strategic and operational resilience. This paper critically examines two of these core principles—integrated risk management and proactive risk culture—and analyzes how they are applied within the case study, supported by external scholarly research.

The first principle, integrated risk management, emphasizes the importance of embedding risk assessment into the core strategic and operational processes of the organization. Mars demonstrates this principle by ensuring that risk management is not a standalone function but is integrated into decision-making at all levels. For instance, during strategic planning, Mars evaluates potential risks associated with new product launches, supply chain disruptions, or market entry strategies. According to Fraser, Simkins, and Narvaez (2015), integration of risk management within strategic planning enhances organizational resilience by allowing early identification of potential threats and aligning mitigation strategies with business objectives. In the case of Mars, this integration facilitates a comprehensive view of risk, enabling senior management to prioritize resource allocation effectively and develop contingency plans, thereby fostering agility.

External research supports the application of integrated risk management. Wildavsky (2012) advocates that successful ERM frameworks integrate risks with strategic objectives, creating an organizational environment where risks are transparently communicated and managed as part of everyday decision-making processes. Mars's approach aligns with these findings, where risk considerations are woven into operational routines—be it supply chain optimization or product innovation—ensuring that risk awareness becomes a core organizational competency (Bromiley, McShane, Nair, & Rustambakhsh, 2015). This integration not only bolsters the organization’s capacity to anticipate and respond to risks but also enhances strategic responsiveness, a critical attribute in the highly dynamic consumer goods industry.

The second principle, proactive risk culture, focuses on cultivating an organizational ethos where employees at all levels are encouraged to identify, communicate, and address risks proactively. Mars has fostered such a culture through comprehensive training programs, incentive mechanisms, and leadership committed to transparency and accountability. For example, employees are trained to recognize early warning signs of supply chain risks or reputational threats and empowered to escalate concerns promptly. This proactive stance is vital, as it reduces the likelihood of surprises that could derail strategic initiatives (Kaplan & Mikes, 2012). A proactive risk culture also promotes resilience by embedding risk awareness into daily activities, encouraging innovation while managing potential downsides.

Research external to the case also underscores the effectiveness of cultivating a risk-aware culture. Aon (2019) argues that organizations with strong risk cultures are better positioned to identify emerging threats, respond swiftly, and capitalize on opportunities that others might overlook. Mars’s emphasis on leadership engagement and continuous risk communication aligns well with these principles, fostering an environment where risk considerations are part of the organizational DNA. This cultural aspect is crucial in enabling Mars to maintain operational excellence and sustain competitive advantage amid industry volatility and regulatory uncertainties.

In conclusion, Mars’s ERM framework reflects a sophisticated application of core principles such as integrated risk management and proactive risk culture. These principles enable Mars to embed risk considerations into its strategic and operational fabric, ensuring agility, resilience, and sustainable growth. External research emphasizes the significance of these principles, illustrating their impact on organizational effectiveness. By continually reinforcing these principles, Mars positions itself not merely as a risk-mitigating organization but as a proactive, strategic enterprise capable of navigating complex business environments.

References

Aon. (2019). Global risk management survey. Retrieved from https://www.aon.com

Bromiley, P., McShane, M., Nair, A., & Rustambakhsh, E. (2015). Enterprise risk management: Review, critique, and research opportunities. Long Range Planning, 48(4), 265-278. https://doi.org/10.1016/j.lrp.2014.06.007

Fraser, J., Simkins, B., & Narvaez, K. (2015). Implementing enterprise risk management: Case studies and best practices. Wiley.

Kaplan, R. S., & Mikes, A. (2012). Managing risks: A new framework. Harvard Business Review, 90(6), 48-60.

Wildavsky, A. (2012). Speaking truth to power: The art and craft of policy analysis. Transaction Publishers.