IRM ERM M1U2.4 RASP - Protocols

Question 1

Risk Protocols

Answer 1

Organisations develop and use risk protocols as the means by which the selected risk strategy and architecture are delivered in practice.

These may be collated together into a manual, standard, procedure, tools, templates, techniques, or collection of these documents

Question 2

Risk Manual

Answer 2

Different organisations refer to this document as their procedures, framework, manual, guidance, and so on – it will usually depend on their document control system.

Question 3

Risk Tools & Techniques

Answer 3

root cause analyses, monte carlo simulation or scenario analyses.

Question 4

RM IS

Answer 4

However, many organisations use a formal, structured IT system to store, analyse and report risk information to senior managers. A coordinated risk repository assists in analysing and managing information, particularly where there are multiple divisions or departments contributing information to the central risk management team.

Question 5

RMIS Analysis

Answer 5

More sophisticated RMIS provide increased risk analysis functionality by taking the risk data from the core system into predictive modelling analytics such as Monte Carlo simulations. The system may also be configured to analyse costs and schedule forecasts in projects – an important feature of project risk management.

A RMIS is an enabler to help risk managers make more informed decisions but does not replace the skills, experience and expertise of a risk manager.

Question 6

Importance of Records

Answer 6

The importance of records There are many benefits to be gained from maintaining good records. It is a key driver in increasing organizational efficiency and offers significant business benefits. Records management: reduces the time spent by staff looking for information; facilitates the effective sharing of information; reduces the unnecessary duplication of information;

identifies how long records need to be kept; optimizes the legal admissibility of records to defend malicious litigation; supports risk management and business continuity planning. In short, records management improves control over information assets, frees up staff time and other resources, and helps protect individuals and the organization from various risks

Question 7

Advantages and disadvantages of RMIS

Answer 7

Advanced technology enables risk managers to integrate techniques of modelling and scenario simulations to suit their individual context.

Whilst the cost of developing systems is reducing, it must be shown that benefits will exceed whatever cost is involved. The costs are immediate and tangible; the benefit is difficult to estimate or demonstrate. It is a potential future benefit, not an assured, immediate expense reduction. Whether the risk assessments from an RMIS are likely to lead to enough marginal benefits to offset the cost of data tracking and analysis depends on the risk profile of the company.

Ultimately, an RMIS may pay for itself by enabling an organization to avoid or effectively finance that one catastrophic loss that would otherwise slash the financial results of the company.