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 Until the 1990s, few business leaders thought of risk management as something broader than the procurement and administration of corporate insurance. In this article, we discuss the challenges confronting the new field known as Enterprise Risk Management (“ERM”) since it has started to emerge over the last 30 years. David Gauntlett joins us for a conversation on the intersection of intellectual property, insurance and risk management. In Part II, David explains how insurance and IP are uncontestably married to each other. Until the 1990s, few business leaders thought of risk management as something broader than the procurement and administration of corporate insurance. In this article, we explore the origins of the new field known as Enterprise Risk Management (“ERM”) and the value of the traditional risk management community to ERM. Because few things are certain, good leaders value expertise and the process of building expert knowledge through fact-based thinking. They embrace the scientific method of gathering, evaluating and analyzing information, and then embracing collaborative review of past experiences and knowledgeable authority for use, study or refutation. Risk is a seemingly simple word that confounds most organizations when it comes to achieving strategic outcomes. We prefer the word uncertainty. Uncertainty includes strengths, not just weaknesses. Appreciating our strengths helps increase the probability and magnitude of good things happening or what we call positive risk.  Doc Hall returns to our newsletter with a thought-provoking three-part essay on the risk of thinking we know the truth of things. Part II challenges us to keep improving our systems for learning. Risk is a seemingly simple word that confounds most organizations when it comes to achieving strategic outcomes. We prefer the word uncertainty. Learning about uncertainty starts with developing an understanding of historical efforts to address the concept of probability.Our recent columns explored the architecture and science behind institutional learning systems that help organizations manage risk – i.e., learn to thrive. Chesley Sullenberger’s story is a fitting capstone to this section, reminding us that learning to thrive is much more than a tale of heroes and miracles.   Our recent columns explored how Paul O’Neill and Stanley McChrystal used institutional learning systems to better manage risk and optimize performance. Emerging science confirms their approach and the need to develop more leaders who can see the future of risk management. |
AuthorsLori Siwik and Mark Siwik are the founders of SandRun Risk. They apply the principles of vertical leadership and lean six sigma to the discipline of risk management. From time to time they share their blog with guest authors who write about important risk management principles. Categories
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