Week 3 – Measuring and Selecting an ERM Framework

Chapter 12 presented the approach Intuit uses to measure the effectiveness of their ERM, and chapter 15 presented the process the City of Edmonton employed to develop and deploy their ERM. You are an ERM consultant, retained by Intuit to re-implement their ERM. They have decided to start over and develop a new ERM for their current organization. Would you recommend that the base their new ERM on PM2 Risk Scorecard or ISO 31000? Explain why you would choose one over the other. You must use at least 2 paragraphs (of you own words) to justify your answer.

To complete this assignment, you must do the following:

A) Create a new thread. As indicated above, assume that you are an ERM consultant, retained by Intuit to re-implement their ERM. They have decided to start over and develop a new ERM for their current organization. Would you recommend that the base their new ERM on PM2 Risk Scorecard or ISO 31000? Explain why you would choose one over the other. You must use at least 2 paragraphs (of you own words) to justify your answer.

B) Select AT LEAST 3 other students’ threads and post substantive comments on those threads, evaluating the pros and cons of that student’s recommendations. Your comments should extend the conversation started with the thread.

ALL original posts and comments must be substantive. (I’m looking for about a paragraph – not just “I agree.”)

NOTE: These discussions should be informal discussions, NOT research papers. If you MUST directly quote a resource, then cite it properly. However, I would much rather simply read your words.

ITS 835
Chapter 12

Measuring Performance at Intuit
Enterprise Risk Management

Professor Michael Solomon

Introduction

•

Intuit’s ERM Journey

•

ERM Maturity Model

• Benefits of Measuring Performance in ERM Models
• ERM

Performance Measurement

and Reporting
• Conclusion

Intuit’s ERM Journey

• Began with ad hoc risk management
• Very common entry point
• Escalated to ERM when seminal event occurred

• Desire was to stop firefighting and start prevention
• Intuit ERM Core Principles

• Enterprise-wide risk framework
• Risk assessment is ongoing
• Focus on most significant risks
• Ownership and accountability
• Measure and monitor performance

ERM Maturity Model

Benefits of Measuring Performance in
ERM Models

• Key Performance Indicators (KPI)
• Based on business objectives
• Quantitative and qualitative KPI
• Leading and lagging indicators
• Input, process, and output indicators

• KPIs must be
• Tangible
• Flexible
• Standardized
• Outcome or objective focused

ERM Performance Measurement and
Reporting

• First evolution – ERM process adoption
• Second evolution –

Risk Mitigation Process Management

• Third Evolution – Multidimensional Risk Management

Performance Measurement

ERM Process Adoption

Risk Mitigation Process Management

Multidimensional Risk Management
Performance Measurement

Conclusion

• At Intuit, risk management is everyone’s responsibility
• ERM must be a core business competency
• Coordination is a key to success
• Recognizes

• Upside opportunity

• Downside risk

• ERM process is regularly audited
• ERM is an integral part of Intuit’s operating model

ITS 835
Chapter 15

Embedding ERM into Strategic Planning at the City of
Edmonton

Enterprise Risk Management

Professor Michael Solomon

Introduction

• Edmonton – Past and present ERM
• Links to strategic plan and to other strategic tools
• Selecting and testing tools and framework
• Recommended strategic ERM approach
• Lessons learned

Edmonton – Past and Present ERM

• Edmonton – Capital of Alberta, Canada
• Over 800,00 population

• ERM piloted in 2005
• CORPORATE Business Risk Planning (CBRP) model

• Not fully implemented

• Based on COSO

• Adopted strategic plan
• The Way Ahead

• Strategic ERM

Links to Strategic Plan

Selecting and Testing Tools and
Framework

Selecting and Testing Tools and
Framework

Strategic Goals and Objectives

Risks and Strategic Objectives

ISO 31000 Risk Management

PM2 versus ISO 31000

Proposed ERM Framework

Lessons Learned

• Key success factors
• Senior management buy-in
• Culture of innovation
• Consistency of model across goals
• Resource requirements for department SMEs
• Department accountability for key risks

• Process of selecting and implementing framework
• Takes linger than expected
• No system is perfect
• Do not roll out all at once
• Clearly define all milestones and deliverables