Enterprise Risk Management
Abstract
This paper discusses how a company can successfully implement the Enterprise Risk Management based on COSO guidelines. This paper discusses a step by step process of the implementation plan at Dell Inc, the responsibilities of the workforce and management, the risk mitigation approach and how to monitor the activities successfully.
Enterprise Risk Management
In the wake of all the financial scandals, a variety of laws and regulations have been passed which makes the board of directors solely responsible for the financial results of their company. Sarbanes Oxley Act of 2002 was one of them, but this covers only a part of the total risks that a company faces. A much wider range like strategic, operational and hazardous risks lies outside this. To cover all the aspects of risks that an organization faces, companies are implementing the Enterprise Risk Management program, which means:
Enterprise risk management is a process, effected by an entity's board of directors, management and other personnel, applied in strategy setting and across the enterprise, designed to identify potential events that may affect the entity, and manage risk to be within its risk appetite, to provide reasonable assurance regarding the achievement of entity objectives. (coso, 2004).
In this paper I will be outlining a plan to implement the enterprise risk management based on COSO recommendations for Dell Computers Inc.
The main step in implementing the ERM plan is to create a framework that will define what the ERM will mean for the company and use this framework to develop a plan that will be tailored to the company's needs. The company should assemble a team that is motivated to implementing a successful ERM program. The team members can be selected from different departments, where each member represents each unit. The members selected should be committed and motivated towards implementing a successful risk management program....
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