ERM - Enterprise Risk Management: Issues and Cases

8 Case Study: Agreeing Upon the Scope of the Project and the Job of the ERM Risk Manager

Christopher Ketcham

Ph.D., CPCU, CRM, CIC, CFP^®, Formerly Visiting Assistant Professor, University of Houston Downtown, Houston, Texas; Garnet Valley, Pennsylvania

This expository is based on an interview and commentary from veteran Risk Manager, Franck Baron, and his recent experience of negotiating the scope of his responsibilities during and after the hiring process as General Manager, Risk Management with the leaders of the privately owned company he is working for now. He recounts his experiences from pre-hire negotiations into the identification phase of the organization's ERM project. He offers suggestions on how to negotiate the job and set the stage for ERM with senior leadership. The views expressed here result from a sharing of experience with the authors of the book and do not represent the views of Mr. Franck's current employer.

8.1 SCOPE OF THE PROJECT

When an organization determines that it is ready to explore an ERM enterprise-wide risk management initiative there are a number of items that must be considered. First, the change from traditional risk management to ERM is more than a phase change – it is a re-learning process about the nature of risk. The organization's strategy is the cornerstone of ERM. Organizations that do not have a robust strategic plan and consistent strategic message, goals, and objectives will need to develop these first, involving RM in the process ...