Enterprise Risk Management Is Looking At The Big Picture

Enterprise Risk Management Is Looking At The Big Picture

November 29, 2018 Business Insurance and Risk Management, The Beacon Blog 0 Comments

If you want to understand the difference between traditional and enterprise risk management, a recent post by Carol Williams (https://www.erminsightsbycarol.com/beyond-one-on-one-risk-management) explains it very simply. Traditional risk management looks at each risk individually. Enterprise risk management looks at how all the functions of an organization create risk. It requires analysis to determine connections, trends and/or concentrations of risk.

Traditional risk management does not show the relationship between risks and their cumulative effects. Enterprise risk management looks for common elements in two or more risks. It looks at root causes for possible overlap, so organizations can better invest their resources where they can do the most good. The cumulative effects of risks can be determined through modeling and data; outside expertise may be needed.

Whether your organization uses formal or informal risk management, enterprise risk management gives you the big picture.

About the Author

Harry Cylinder

Harry Cylinder, CPCU, ARM has spent nearly fifty years in the insurance industry, the majority of the time as a consultant. He has been employed by The Beacon Group of Companies since 2008, specializing in the review and analysis of property and casualty coverage forms. Mr. Cylinder has been reviewing policy forms as they have evolved over the past decades. In 2008 he published an article in the CPCU Journal which was the first description of cyber insurance coverage for a general insurance audience. Since that time he has regularly written on cyber and other topics for The Beacon Companies’ blog.