Tuesday, September 3, 2013

Reading the trends to chart the future

The increasing competition and uncertainty in the marketplace put companies around the globe to revisit their strategies, business models and products. There is a surging belief that in order to keep the business running competitively, businesses must innovate. And to do that, organizations are starting to revisit their existing operations, redesign their processes and launch new products at competitive prices. Those that succeed in this competitive environment must have better risk management capabilities because as businesses innovate and compete, they are taking more risks.

The interesting point here is that as businesses reinvent their wheels, new risk management trends are being charted. Let’s take a look at some of the most interesting trends in risk management for the past two years.

Integration to strategic planning. Most Fortune 500 companies have started adopting the concept of Enterprise Risk Management or more popularly known as ERM as a regular top management agenda. ERM is a structured, disciplined, proactive and integrated approach to understanding and managing the company’s key business risks. A survey conducted by PwC during the 3rd quarter of 2012 shows that 43.8% of all industry sectors responded that risk management is poorly, if not, integrated to their strategic planning process (source: Risk in view: Coping with the unknown, August 2012):



Going beyond the BCP. Organizations are well-aware of the need to create back-up plans to ensure business continuity. This includes safety awareness campaign, earthquake drills, and having a well-crafted business continuity plans. But since the scenarios such as major disasters and pandemics are very hard to anticipate even by the most sophisticated ERM systems, many pragmatic executives focus their energy not on detection but on responding to each risk. The challenge is more on producing a well-coordinated, firm-level response and sustaining resiliency. In addition, BCPs are extending even outside the organization through the emergence of the supply chain risk management.

Technology as enabler. After the boom of ERPs in the early 2000’s, there is another boom coming into the picture – the ERM systems. The increasing complexity on forecasting uncertainties and integrating all risk management data from all over the enterprise prompted the call for ERM platforms. These platforms have the capability to identify and track risks, analyze and forecast, and even respond to the risks through its updated and interactive dashboards and tools. However, executives and risk management professionals argues that there is no one-size-fits-all ERM platform. The challenge, therefore, is not finding the perfect tools but fitting the tools to the risk management needs and requirements of the company particularly on the areas of vulnerability.

The importance of culture. The most brilliant solution, backed up by libraries of data and promising billions of extra profits, will most likely fail if the organization cannot implement it. It is therefore important to fit the solution to the culture of the organization. Risk management professionals from within the organization and external firms (which includes the top management consulting firms and the Big 4) must tailor the solutions to the circumstances. Risk management should not be a purely academic sexy concept but a pragmatic solution to the business risks facing the organization.

Understanding of emerging risks. Emerging risks are defined as risks that appear on the corporate horizon but unfold in hard-to-predict ways. With such nature, they can be hardly assessed and managed. Nevertheless, they still are risks that must be managed as far as ensuring the attainment of business goals is concerned.

Common examples of the emerging risks today are the social media threats and the ‘black swans’. Social media is surprisingly changing people’s and organizations’ ways of doing things which almost no one had predicted during the dot-com boom in 90’s. A simple click in the social media today may mean a huge impact on an organization’s in the future. Yet, most organizations have no formal policy on governing employee engagement with social media.

On the other hand, the Black Swan is a theory coined (and also the title of the book) by Nassim Nicholas Taleb which is described as a highly-unexpected events of large magnitude and may have catastrophic consequences. Examples of recent black swans are the March 11, 2011 Japanese tsunami which caused the Fukushima nuclear disaster and eruption of Iceland’s Eyjafjallajokull volcano in April 2010 which shut down transatlantic and European air travel.

As we put on our one foot on the gas pedal, we should always check if the brake is functioning well on the other. The same is true in working on our everyday activities in our organizations. Our journey towards the attainment of the organizational goals, be it short, medium or long-term, is not without a risk of failing. These risk management trends give us indications of opportunities to pursue and gaps to fill-in.

Sunday, March 3, 2013

I've just tried this temperament quiz. The results are nearly accurate!
Certificate: Test results
Which temperament are you?

For 35 % you are: You're the melancholic (also known as melancholy.) temperament! (derived from the Ancient Greek term of *black bile*, which doesn't really exist..) Deep, analytical, and sensitive, you have the ability to see flaws very quickly. There's also a chance that you're artistic or musical. You enjoy your own company, but usually hold grudges and are a pessimist, plus self-deprecating, due to having really high standards. Chances are that you're a perfectionist. Let some of the bad times go, and look on the bright side sometimes! Oh, stop thinking it's an 'all or nothing' thing. Don't have to have everything perfected ALL the time! (but at heart, I really get that... I got perfectionist issues too..) You roughly represent the earth element.
10.0877 % of 14146 Quiz participants had this profile!

You could also get this result:
For 25 % you are: You're the choleric temperament! (derived from the Ancient Greek term of *yellow bile*, not that that type of bile actually exists; they understood science in a pretty off point of view back then, thinking that personality relates to specific types of liquids.) A leader, you can't help but strive to be superior, one way or another. You also have the guts to take charge if everyone was just standing around doing nothing. In friendship terms, likely, you're very reliable. You wouldn't break a promise for a trillion bucks. (or more?) You could be pretty possessive of your friends or significant other... No, you're not evil. But sometimes you value being superior more than more essential things. You're also impatient, quick-tempered, bossy, and even proud and unsympathetic. Be a little more emotional at times. Also, if you're wrong, don't deny it. You roughly represent the fire element.

Or even this one:
For 25 % you are: You're the phlegmatic temperament! (derived from the Ancient Greek term of phlegm.) Calm, cool, and collected, and possibly meek, it's like impossible to ever lose control, huh? Heck, you're usually the peaceful, mediator guy that calms down everyone else, willingly, in fact! And, being your shy, mild-mannered self, the last thing you want to do is hurt someone. Don't be scared to give people a piece of your mind. You also usually just go along even if you don't want to. And hype up every now and then! Be more enthusiastic about things! You roughly represent the water element, by the way. And one more thing: I'm this temperament, too!

Or even this one:
For 15 % you are: You're the sanguine temperament! (derived from the Ancient Greek term of blood.) Life-of-the-party, you're outgoing and friendly. There's a chance that you might be popular, too! Ooh, and you've got a really unique ability to raise the spirits in others; you're pretty influential.(due to your great people skills and all that.) Yup, it's about having fun and being wild, but it's also about calming down once in a while. The reason I'm saying this is because you're crazy, hyper, random, etc. Being an optimist, make sure you're not blindly optimistic. Sometimes your happy-go-lucky theme can irritate others. It's likely because of this that you are naive. (not necessarily, though.) But look on the bright side! Your talkative, cheerful personality sure can brighten up someones day! (influence is different from bringing others back to happiness in case you're confused.) You roughly represent the air element.
 
Take this quiz: Which temperament are you?

Saturday, February 23, 2013

Just In Time


Just when I felt that I can fly no higher than my first flight;
Just when I’m about to consider that exit is the only way to go;
Just when I thought that everyone else had turned their backs on me;
A few great and highly-respected people who’ve been silently watching me from above
came down to pat me on the back and say “We still believe in you".


Indeed, good mentors are hard to find. You may never find them instantly. But they will always be there, just in time, during your most trying days.