July, 20229 Principle #3: "To know your Enemy, you must become your Enemy." ­ Sun TzuWhen identifying risks, you should try to break your processes and systems. This is what the bad guys do. Build an understanding of what could go wrong when different negative situations might occur (e.g., power outages, operational mistakes, inability to access your systems or data, etc.). This understanding drives sound contingency planning and helps you to design and execute sound continuous improvement strategies. Applying this principle will significantly increase your Risk Management program's effectiveness.Principle #4: "The line between disorder and order lies in logistics." ­ Sun TzuBe transparent and provide awareness and training for your program. Provide the appropriate expertise to guide your business lines through the process. Monitor each business line, their operational metrics, their level of risk management participation, their emerging concerns, and their strategic plans. This principle drives a strong transparent Risk Management program.Principle #5: "He who is prudent and lies in wait for an enemy who is not, will be victorious." - Sun TzuYou should have an Emerging Risk portion of the program. Look outward to environmental, political, and social happenings to understand what might impact your company positively (i.e., strategic opportunities) or negatively (i.e., opportunities to increase company resiliency). Be proactive and pervasive in your analysis. Understand the likelihood, potential timing, dependencies, and multiple impacts of these events to drive comprehensive plans. This principle enhances the extensiveness of your Risk Management program.Principle #6: "This game is ninety percent mental, the other half of physical" - Yogi BerraYogi Berra might not be good at mathematics, but he does capture the martial arts spirit. This principle is simple, "you get out of it what you put into it". Half of any success is in showing up;the rest is being very present and contributing to the process. Everyone on the team has something to contribute. Be mindful. Be respectful. Be constructive. Be open to listening. Be ready to follow through to champion the implementation of controls in your line of business. This is how the "game" is played and how we all win.Principle #7: "Unhappy is the fate of one who tries to win his battles and succeed in his attacks without cultivating the spirit of enterprise, for the result is waste of time and general stagnation." ­ Sun TzuEnterprise Risk is a shared discipline. Each of us has the capacity to understand business impact and the skills to prevent negative outcomes from occurring. Conversely, an organization that is open to identifying opportunities and to taking controlled risks can enhance business growth. If the culture upholds this principle, the company is bound to prosper.Bonus Wisdom: "In the beginner's mind there are many possibilities, but in the expert's mind there are few." ­ Daisetsu TeitaroSuzukiWhen you look back at what you have accomplished, you will be amazed. The more iterations you take the business through, the more that the process improves. You will find over time that the answers will become more evident and repeatable as your program matures.ConclusionThe principles above are designed to guide your Risk Management program through levels of maturity. Cultivate your company's Risk Management culture. Build your company's understanding of the Risk Management program, the importance of constructive participation, and the need to consider external and internal factors when building resilient contingency plans and strategic initiatives. DON'T WAIT TO ASSESS AND MANAGE YOUR RISKS! THIS PRINCIPLE IS BASIC BUT EMPHATICALLY ESSENTIAL TO SUCCESSFUL RISK MANAGEMENT
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