Forrester recently published an article titled, Business Drivers for Enterprise Risk Management, detailing why companies struggle with implementing and managing a successful enterprise risk management (ERM) program. When you look at inconsistencies in risk management strategies among different types of businesses and companies being forced to take risk measures due to scandal, it is obvious why many businesses fail to reap the benefits provided by a successful ERM program. In order to take full advantage of ERM, businesses should look at many different drivers:
- Going concern of business
- Culture of other countries
- Industry standards
- Opportunity omission
Other factors that influence the successful implementation and management of an ERM program include consistency, efficiency, and sustainability. Companies should never base their risk program solely on specific objectives. It is important to incorporate the following activities to overcome failure in a risk management program:
- communication between executives from all areas of the business;
- promotion of risk management influenced by business drivers;
- responsibility of risks in individual units of the business; and
- communication between peers to obtain helpful risk management ideas.
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