Enterprise Risk and Opportunity Management

Chapter 6Special Considerations for EROM Practice and Analysis at Commercial TRIO Enterprises

6.1 Overview

The bulk of the discussions so far have focused on TRIO enterprises whose primary objectives concern the development and implementation of risky technologies aimed at scientific advancement for the benefit of the public. These enterprises tend to be government or nonprofit organizations. However, as discussed several times in earlier chapters, many of these government and nonprofit enterprises rely heavily on commercial partners, who often play the role of a prime contractor. Others take the role of subcontractors under the direction of a prime contractor, or under contract directly to the government or a nonprofit sponsoring organization. Thus, it is obviously in the interest of both the noncommercial and commercial enterprises to form EROM alliances and foster consistencies of approach that work for both.

The top objective of TRIO enterprises that operate for profit is ultimately to provide monetary gain for their companies and their shareholders. Like the objectives of a public enterprise, the financial objectives of a commercial TRIO enterprise involve short-term, mid-term, and long-term goals. The shorter-term financial objectives satisfy the more immediate needs of the shareholders, whereas the longer-term ones help ensure the viability of the company. Unlike noncommercial enterprises, however, the implementation of technical research, integration, and operations ...