31 March 2019

Operational Risk Management: Discipline and Professional Development...

You know that the discipline of Operational Risk Management has finally reached the minds of global executives and Board of Directors, when you see growth in the organizations that have established a Board-level Executive in charge of Operational Risk Management (ORM).

The ORM discipline has now spanned several primary critical infrastructure sectors of the global economy for over a decade, including Energy, Financial Services, Information Technology, Defense Industrial Base and others who are highly regulated by government.

Global organizations such as BP as one example, have found the necessity of new Operational Risk capabilities. This is to produce a prudent and consistent strategy after a Gulf of Mexico Macondo Blowout, in other parts of the planet where deep water drilling is still a vital solution.

Goldman Sachs and the other band of brothers in the global financial crisis of the decade past, have reinvested in more prudent Operational Risk Management strategies. The books that have been written outlining the risks of people taking on derivatives of one type or another to hedge the marketplace have been prolific.

IBM, Google, Apple, AWS and Cisco have capitalized on "Operational Risk Management" and its focus on business continuity planning (BCP), continuity of operations planning (COOP) and the facilitation of utilizing cloud computing to enhance the resilience factor of critical systems.
The pervasive growth of people however, utilizing social networking in the workplace, has created its own set of OPS Risk challenges.

Spear phishing, targeted fraud schemes such as Business E-mail Compromise (BEC) and sophisticated software exploits, can be attributed in many cases to the plethora of personal information the criminals and intelligence activities have to work with.

Social engineering, economic espionage and other transnational criminal activities are continually perpetuated by the security and privacy failures of the critical infrastructure industries.

The Defense Industrial Base including the US Navy, US Marines, US Army, US Air Force and our Coast Guard, know the value of effective Operational Risk Management. The discipline is a core aspect of their cultures and is continuously tested and measured on a daily basis.

On the flight line or on the base, these branches of the military use ORM to save lives and protect valuable assets worth millions of dollars every day.

As the Board of Directors focus on ORM across the globe, one can only wait and see how it will impact the discipline of the individuals themselves.

We trust that our practitioners will continue their own quest for expanding the portfolio of thinking and to see that the right people are at the table, to assist in ORM direction and continued global success.

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