Strategy and how ERM can be integrated with an organization’s overall strategy.

Sample Solution

    ERM, or Enterprise Risk Management, refers to the systematic and coordinated activity of an organization in order to identify, analyze and manage risks that may have a significant impact on its operations. When effectively implemented and managed, ERM can be used as an integral part of a company’s overall strategy.

This is because it enables organizations to proactively address existing risks while also encouraging them to anticipate potential future risk events. In doing so, organizations are better able to direct their resources towards pursuing their goals and objectives in an effective manner. There are several protocols that must be followed when integrating ERM into an organizational strategy. Firstly, adequate resources should be allocated for the purpose of implementing ERM initiatives within the organization. Secondly, senior management should demonstrate strong commitment towards ensuring that relevant strategies are properly identified through continual review processes conducted by internal auditors who specialize in this field. Additionally, companies need to ensure that any new risk management plans developed align with those already in place within the company’s strategic framework. Furthermore, clear performance indicators need to be established in order for executives and other stakeholders to monitor progress towards achieving desired outcomes related to identified risks. Various frameworks exist which can help organizations integrate ERM into their overall strategy. For example; The International Standard ISO 31000:2009 provides guidance related on how risk management principles can be applied across different industries and contexts; COSO-ERM provides comprehensive approaches for designing optimal structures for managing enterprise-wide risks; and FAIR-ERM helps quantify financial losses associated with uncertainties incurred due various sources such as natural disasters or malicious attacks from external actors – enabling companies prepare themselves adequately against such occurrences by allocating sufficient funds towards mitigating pertinent threats before they materialize (Harris & McCammon 2011). Organizations utilizing these frameworks will find it useful if they learn from past experiences – even if no particular incident had occurred previously – since this allows them structure responses more effectively when similar situations arise again down the line (RiskLibrary 2018). Doing so would also encourage further dialogue between departments about possible scenarios so that everyone is aware of how best handle certain challenges if/when they arise at some point (Olson & Tranfield 2012). In conclusion though not absolutely necessary all businesses stand benefit when incorporating Enterprise Risk Management into their overall strategic planning process as it allows them gain greater insight regarding both current circumstances surrounding them as well as any potential challenges they might face sometime down line - ultimately providing leverage needed move forward confidently without fear getting caught off guard due something unforeseen happening later time around . References: Harris , R., & McCammon S.(2012). Understanding Enterprise Risk Management: Theory And Practice(Vol 15): John Wiley & Sons Ltd.. Olson , M., & Tranfield , D.(2012). Defining A Framework For Implementing And Evaluating Strategic Risk Management Projects(Vol 17): JAI Press Inc.. Risk Library.(2018) What Is An Effective Framework For Integrating Erm Into An Organization's Overall Strategy? [Online]. Available at : [Accessed 25 April 2021]