Now that the updated COSO and ISO risk management standards emphasize a connection to enterprise objectives and decision making, does this mean ERM and GRC solutions focused on risk registers and regulatory compliance are missing the true value of risk management?

Will current risk management solutions evolve to integrate more decision support functionality or will standalone prescriptive analytics and other technology solutions take a more prominent role in enabling risk-informed decision-making processes? 

I have analyzed the range of service, software, and information product vendor resources that I believe will be relevant to integrating risk management and business decisions, and invite GlobalRisk Community members to review a complimentary copy of this report as noted in the blog post "A New Perspective on Vendor Resources for Risk-Informed Decision Making." 

What are your opinions on how current vendor offerings may change or what new players will emerge to help embed risk management into decision-making processes?

You need to be a member of Global Risk Community to add comments!

Join Global Risk Community

Votes: 0
Email me when people reply –

Replies



  • John Farrell said:

    Another view comes from Daniel Kahneman's categorization of System 1 and System 2 decision making in "Thinking. Fast and Slow." He suggests System 1 thinking, used to address many of our everyday decisions, is fast and emotional. This aligns with your view of qualitative decision making. On the other hand, there are more weighty decisions in which we use a more calculating System 2 thinking process. These are important decisions which incorporate quantitative assessments.

    My belief/hope is that System 2 thinking, which enacts risk management principles, increasingly embeds in more business decisions supported by the increased adoption of machine learning AI-driven solutions. This could improve decision making in two important ways:

    1. Apply some quantitative thought and analytics to what may normally be considered decisions using System 1 thinking. 
    2. Reduce the time requirements for System 2 thinking processes. 

    There are many reasons why people avoid using a quantitative or System 2 approach, but some of the emerging technologies can take away concerns about the possible slower speed or complexity of quantitative, risk-aware decision-making processes.

    Carlito Carlos Edwin A. Gierran said:

    Decision making is qualitative analysis while risk management solutions are quantitative. In decision making process it should be a combination of qualitative and quantitative analysis. 

    If risk management is about decision making, are current risk management solutions irrelevant?
    Now that the updated COSO and ISO risk management standards emphasize a connection to enterprise objectives and decision making, does this mean ERM a…


  • John Farrell said:

    Another view comes from Daniel Kahneman's categorization of System 1 and System 2 decision making in "Thinking. Fast and Slow." He suggests System 1 thinking, used to address many of our everyday decisions, is fast and emotional. This aligns with your view of qualitative decision making. On the other hand, there are more weighty decisions in which we use a more calculating System 2 thinking process. These are important decisions which incorporate quantitative assessments.

    My belief/hope is that System 2 thinking, which enacts risk management principles, increasingly embeds in more business decisions supported by the increased adoption of machine learning AI-driven solutions. This could improve decision making in two important ways:

    1. Apply some quantitative thought and analytics to what may normally be considered decisions using System 1 thinking. 
    2. Reduce the time requirements for System 2 thinking processes. 

    There are many reasons why people avoid using a quantitative or System 2 approach, but some of the emerging technologies can take away concerns about the possible slower speed or complexity of quantitative, risk-aware decision-making processes.

    Carlito Carlos Edwin A. Gierran said:

    Decision making is qualitative analysis while risk management solutions are quantitative. In decision making process it should be a combination of qualitative and quantitative analysis. 

    If risk management is about decision making, are current risk management solutions irrelevant?
    Now that the updated COSO and ISO risk management standards emphasize a connection to enterprise objectives and decision making, does this mean ERM a…
  • Decision making is qualitative analysis while risk management solutions are quantitative. In decision making process it should be a combination of qualitative and quantitative analysis. 

This reply was deleted.

[Free COVID-19 Framework] What's the path to recovery look like?

We created a free presentation (attached), which discusses both global and organizational impacts of the COVID-19 pandemic, along with critical actions organizations should take immediately. This presentation introduces a framework that helps regions and organizations navigate a path to recovery via 9 potential scenarios. These scenarios capture outcomes related to GDP impact, public health response, and economic policies. The presentation also breaks down 6 immediate and critical actions…

Read more…
3 Replies · Reply by Boris Agranovich Jan 2
Views: 66

If risk management is about decision making, are current risk management solutions irrelevant?

Now that the updated COSO and ISO risk management standards emphasize a connection to enterprise objectives and decision making, does this mean ERM and GRC solutions focused on risk registers and regulatory compliance are missing the true value of risk management?Will current risk management solutions evolve to integrate more decision support functionality or will standalone prescriptive analytics and other technology solutions take a more prominent role in enabling risk-informed…

Read more…
3 Replies
Views: 41

A question related to classification of instruments between trading and banking book.

We have an interesting question from one of our members.       "We usually perform OTC FX transactions with clients backed-to-back on the market (with Banks). Now we are going to perform a FX swap (i.e. Spot + forward) JPY/EUR for the Bank account for 1 week at the longest. The purpose is to get EUR place @ CB for LCR compliance purpose (no trading purposes). Bank's Management think that this should be considered as a trading position and therefore be classified within the Bank's trading book.…

Read more…
4 Replies
Views: 100

Plunging oil prices: curse or blessing in disguise?

The recent sudden crash of oil prices has had a major impact on the world economy, leading to many troubled faces in the international arena. The Russians fear the effects of yet another powerful hit on their economy, Venezuela seems to be considering default and the Americans are weary of the consequences for its young and emerging shale oil industry. And then you have the Middle East, where the smallest match is enough to ignite the largest fire. But are these worries really justified or…

Read more…
1 Reply
Views: 16

Introducing the Global Risk Series - Book 1 Risk Management How Tos

Dear GlobalRisk Community member, Our community’s mission is to foster business, networking and educational explorations among members. Learn from some of the top experts in the industry as they clearly explain how to approach the most important Risk management concepts. Check out their expert tips and use the link at the end of each article to navigate back to the website to leave your comment or ask a question. Some of the topics include: How do you Explain Risk Appetite?  How to Prepare a…

Read more…
12 Replies
Views: 189

    About Us

    The GlobalRisk Community is a thriving community of risk managers and associated service providers. Our purpose is to foster business, networking and educational explorations among members. Our goal is to be the worlds premier Risk forum and contribute to better understanding of the complex world of risk.

    Business Partners

    For companies wanting to create a greater visibility for their products and services among their prospects in the Risk market: Send your business partnership request by filling in the form here!

lead