The Submission Must Be Submitted In MS Word Documents

The Submission Must Be Submitted In Ms Word Documents Submitted In Ot

The submission must be submitted in MS-Word. Documents submitted in other formats will not be accepted. You are allowed only one submission for the final. Before submitting the final be sure to proof and make sure your work is complete. There are 4 questions and each question is worth 25 points and they are as follows: 1) Using the Chapter 27 Case Study, Nerds Galore, develop a Risk matrix for the HR-related risks on p. 532. For each of the Risks in your matrix justify your decision as to their placement on the Risk matrix. 2) Embedding Strategic ERM into Strategic Planning is an important means to implement ERM for an organization. Develop a Cause and Effect (Ishikawa) chart that would show the factors needed to make a decision to include ERM in Strategic Planning. Provide a description explaining your chart? 3) Using the case study from Chapter 14 on Zurich Insurance, explain how Zurich's Capital Management Program supports ERM and provide examples of where Zurich created new value with their ERM program? 4) What are at least 3 Traditional Risk Management practices that are included in ERM? Clearly define the traditional risk management practice and how it fits with ERM. Adequate support including applicable case study examples from your text can be applied.

Paper For Above instruction

The implementation of Enterprise Risk Management (ERM) within organizations represents a holistic approach to identifying, assessing, and managing risks that could impede strategic objectives. This paper addresses four critical questions related to ERM, utilizing examples from specific case studies to illuminate best practices and practical applications.

Question 1: Developing a Risk Matrix for HR-Related Risks in Nerds Galore

The first task involves creating a risk matrix based on the case study "Nerds Galore" detailed on page 532. A risk matrix visually represents the likelihood and impact of various risks, aiding in prioritization and resource allocation. For HR-related risks, these might include talent retention issues, workplace safety concerns, or compliance with employment laws. Each risk's placement within the matrix depends on its assessed probability and severity.

For example, a high employee turnover might be rated as high impact and high likelihood, placing it in the top-right corner of the matrix. Conversely, a minor compliance issue may fall into a lower impact and lower likelihood category. Justifying the placement involves analyzing the context of Nerds Galore, understanding historical data, and considering potential organizational consequences.

This systematic approach allows organizations to focus on the most critical HR risks, ensuring they allocate sufficient resources to mitigate potential threats effectively.

Question 2: Embedding Strategic ERM Using a Cause and Effect Chart

Integrating ERM into strategic planning requires understanding the interrelated factors that influence this process. A Cause and Effect (Ishikawa) chart helps visualize these factors by categorizing potential causes into various branches such as leadership commitment, organizational culture, risk appetite, and resource availability.

The chart might include branches like:

• Leadership Commitment: executive support and strategic oversight
• Organizational Culture: risk awareness and openness to change
• Strategic Objectives: alignment with risk appetite and organizational goals
• Resource Allocation: technology, personnel, and training

Developing this chart clarifies the complex relationships and highlights areas requiring attention to successfully embed ERM into strategic planning. A supportive description emphasizes that effective implementation depends on leadership endorsement, cultural shifts, and aligning ERM initiatives with strategic priorities.

Question 3: Zurich Insurance Case Study and Support for ERM

Zurich Insurance's case from Chapter 14 demonstrates how a well-structured Capital Management Program enhances ERM. Zurich's approach involves robust capital adequacy assessments, risk-based capital allocation, and stress testing. This comprehensive strategy ensures the firm maintains sufficient capital buffers against adverse events, supporting overall risk management objectives.

Examples of value creation include improved risk-adjusted returns, enhanced stakeholder confidence, and reduced cost of capital. For instance, Zurich's proactive management of catastrophe risks through reinsurance and diversification strategies illustrates the value added by integrating ERM into their capital program. This holistic view allows Zurich to identify emerging risks early and develop strategies to mitigate potential losses while seizing opportunities for growth.

Question 4: Traditional Risk Management Practices in ERM

Traditional risk management practices are foundational elements integrated within ERM frameworks. Three notable practices include:

1. Risk Identification: The process of recognizing potential hazards. Traditionally confined to specific areas like insurance, ERM broadens this to encompass enterprise-wide risks, encouraging a comprehensive risk inventory.
2. Risk Transfer: Transferring risk via insurance or contracts. ERM incorporates this but also emphasizes strategic risk transfer, such as diversification or derivatives, to optimize risk portfolios.
3. Risk Control and Mitigation: Implementing measures to reduce risk impact. ERM promotes proactive controls like controls and policies across the enterprise rather than reactive measures in isolated units.

These practices support ERM objectives by providing structure, reducing volatility, and aligning risk management with strategic goals. Case studies from the textbook exemplify these practices, such as Zurich's risk mitigation strategies and Nerds Galore's HR risk assessments.

In conclusion, embedding traditional risk management practices into ERM enhances organizational resilience and aligns risk management with strategic objectives, ultimately creating organizational value.

References

• Frigo, M. L., & Anderson, R. J. (2011). Integrating strategy and risk management. Strategic Finance, 92(4), 42-49.
• Power, M. (2007). Organized Uncertainty: Designing a World of Risk Management. Oxford University Press.
• Fraser, J., Simkins, B., & Narvaez, K. (2015). Enterprise Risk Management: Today's Leading Research and Best Practices for Tomorrow's Executives. Wiley.
• Bromiley, P., McShane, M., Nair, A., & Rustambakova, E. (2015). Enterprise Risk Management: Review, Critique, and Research Directions. Long Range Planning, 48(4), 265-276.
• Hoyt, R. E., & Liebenberg, A. P. (2011). The Value of Enterprise Risk Management. The Journal of Risk and Insurance, 78(4), 795-822.
• Basel Committee on Banking Supervision (2011). Principles for Effective Risk Data Aggregation and Risk Reporting.
• Reuvid, J. (2018). The Complete Guide to Risk Management. Kogan Page.
• Lam, J. (2014). Enterprise Risk Management: From Incentives to Controls. Wiley.
• Chapman, C., & Ward, S. (2011). How to Manage Project Opportunity and Risk: Why Uncertainty Rules Your World. Wiley.
• McShane, M. K., Nair, A., & Rustambakova, E. (2011). Does Enterprise Risk Management Increase Firm Value? Journal of Risk and Insurance, 78(4), 795-822.