Comments on: Enterprise, or Opportunity Risk Management? http://labs.neohapsis.com/2009/07/02/enterprise-or-opportunity-risk-management/ Managing Risk and Security since 1998 Tue, 31 Jan 2012 17:39:48 +0000 hourly 1 http://wordpress.com/ By: Lindsay Cox http://labs.neohapsis.com/2009/07/02/enterprise-or-opportunity-risk-management/#comment-291 Fri, 31 Jul 2009 10:43:31 +0000 http://labs.neohapsis.com/?p=459#comment-291 I assume your question relates to tangible or intangible risks and opportunities. If so, then we need to think of these individually. The definition of tangible is that something is real, definate, comprehensible and understandable, and of course intangible is the opposite. This prompts interesting debate I feel and is a matter of semantics. My view is that a tangible risk could be considered to be the impact you know to expect or are comfortable to suffer, therefore your risk apetite perhaps? But it could also be considered to be an issue or a loss, where a situation, event or circumstance has caused a loss or presented a risk or a number of risks. Clearly losses are measurable. Loss management is an essential part of a good ERM framework (see the earlier blog on this point) so that you can benefit from hindsight and predict loss based on ‘tangible’ experience. The loss experience of the past would also be the measurement metric to influence your risk apetite for the future.
An intangible risk, as it is not definate, could be considered to be the inherent risk faced; the risk that exists implicitly, however it could also be considered to be effect of a threat, risk or loss; an intangible or unknown outcome of an event or situation. This would be far more difficult to measure, though there are sophisticated predictive modeling tools available that I am not qualified to describe or validate.
If we apply the same tangible/intangible definitions to opportunities, a tangible opportunity could be regarded as one with a definate outcome or result. So a potential sale of a product is an opportunity for revenue with a tangible result if the sale is completed. There are plenty of technologies that can help there, from a simple spreadsheet to a complex CRM system. An intangible opportunity is much more interesreting to consider, and is where the outcome is not definate. Good opportunity management is what must be applied for intangible opportunities, and is a subject that needs more space than I have in this comment to discuss, but as a part of COSO, should be utilized in an ERM framework. Intangible opportunities will have measurements associated, including the positive impact(s) and associated probabilities, as well as the associated risks, controls, actions and potential losses that may result from the opportunity.
As to your final question about taking advantage of the knowledge gained, this would demand a set of business processes that make sure strategic planning activities use the output from the ERM framework to influence and validate decisions.

]]> By: Adolf J. Doerig http://labs.neohapsis.com/2009/07/02/enterprise-or-opportunity-risk-management/#comment-284 Sat, 18 Jul 2009 16:54:09 +0000 http://labs.neohapsis.com/?p=459#comment-284 We have quite knowledge and a lot of experience in serving clients with a methodology and a software in the area of opportunity and risk management.

Questions:
Are measurement systems available to measure tangibles and intangibles?
How do we build in in aeffective way the knowledge we gain into a new business architecture?

]]> By: Shannon Marie http://labs.neohapsis.com/2009/07/02/enterprise-or-opportunity-risk-management/#comment-281 Thu, 02 Jul 2009 23:11:33 +0000 http://labs.neohapsis.com/?p=459#comment-281 Perfect.

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