development and application of an enterprise risk assessment tool for transportation agencies mark...
TRANSCRIPT
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Development and Application of an Enterprise Risk Assessment Tool for
Transportation Agencies
Mark Abkowitz & Janey CampVanderbilt University
Logistics, Trade and Transportation Symposium 2014Gulfport, Mississippi
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Enterprise Risk Management (ERM)
A systematic approach enabling an organization to consider all factors that threaten its ability to meet business objectives and implement appropriate risk management controls according to the organization’s risk appetite.
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Why ERM?
• Enhances the safety and security of employees, business partners and the community at large
• Improves the quality of decisions and reduces surprises by being better risk-informed
• Controls unnecessary expenditures by treating risks before they become more costly problems
• Creates opportunities for competitive advantage
• Helps grow a proactive organizational culture that recognizes and rewards problem avoidance
• Increases stakeholder confidence by demonstrating good stewardship
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Managing Risk – Fundamental Questions
• What can go wrong?
• How likely is it?
• What are the consequences?
• What can be done to better manage risk within our available resources?
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ERM Decision-Support Tools• Process has not engaged identification of every hazard
that could manifest itself as a “reasonably foreseeable risk”.
• A consistent framework for categorizing risks to enable a structured ERM approach has been lacking
• User-friendliness is often compromised • Opportunity exists to develop an improved capability
to help organizations:– Understand their entire risk portfolio– Identify where their risk “hot spots” are located– Create a basis from which to formulate and evaluate the
merits of targeted risk reduction strategies
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Introducing RiskCatcher
• A web-based application, structured in a menu-driven format, with modules that mirror the previously-described process steps.
• Operates similar to TurboTax®, where users :– Select relevant risk categories – Describe event scenarios within each category – Assign corresponding scenario likelihoods and consequences
• Can be used to perform both quantitative and qualitative risk analyses.
• Results shown in graphic and tabular form, and may be exported to other software applications.
• Includes a library of scenarios for user access, if desired.
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Scenario Risk
Category Risk
Qualitative Risk Assessment Results
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Quantitative Risk Assessment ResultsScenario Risk
Category Risk
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Concluding Remarks
• RiskCatcher can help the transportation industry and other sectors implement ERM as a core business practice.
• Tool can improve an organization’s ability to identify priority risks and select desirable risk mitigation strategies.
• Bottom line can be an enterprise with less vulnerability and greater resilience.
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http://transp40.vuse.vanderbilt.edu/riskcatcher/
Mark [email protected]
Janey [email protected]
Thank You!