We have learned a tremendous amount of new Operational Risk knowledge in 2004. As we celebrate the holiday season and move into 2005 it is imperative that we reflect on what we have learned. We must take this new found knowledge and use it to mitigate the ever changing threats to our institutions, organizations and business units.
We are reminded of the great book by Stan Davis and Jim Botkin titled The Monster Under the Bed. They talk about how Knowledge is information put to productive use. And they talk about getting from knowledge to wisdom.
Wisdom: The ability to judge soundly and deal sagaciously with facts, especially as they relate to life and conduct; knowledge, with the capacity to make due use of it; perception of the best ends and the best means; discernment and judgment...
Operational Risk Management is about knowledge management and more. It is about learning with the goal of gaining and retaining wisdom. It is about using advanced methods and technologies to detect threats far in advance so that the proper risk mitigation strategies can be put in place. Operational Risk Management is an evolving discipline in our corporate institutions only because we have not yet decided on the exact taxonomy and definitions for each facet of it's breadth and depth. Once we do this, it will become more pervasive across most aspects of business everyday. From the mail room to the board room, we will see Operational Risk Management having an impact on our collective "Wisdom".