|
|
|
|
|
|
|
| Risk permeates all aspects of company life — from the production floor to the boardroom, when dealing with employees and customers and from suppliers to distributors. |
|
|
|
Companies today recognize the need to proactively manage their risks and have either established a formal risk management (RM) function or are planning to do so. But how? How can you be comfortable knowing that the team you have assembled or the one that you are about to create is adequate to the task and has all the appropriate bases covered?
Risk creates challenges and opportunities for an organization — how an organization deals with risk will often impact its financial strength. A strong and effective RM team can provide a competitive advantage by providing the flexibility to exploit risk. On the other hand, ineffective risk management can lead to a negative front page article, a drop in stock price and possibly even put a company out of business.
What Will You Say When They Ask What Happened?
When assessing either their current or future RM capabilities, executives need to be asking themselves the following questions:
- Does my RM department adequately cover all of my organization’s insurable risks?
- Do I have the right people with the proper qualifications managing this function?
- What is my RM relationship with outside vendors? What responsibilities should my organization assume and which ones should I outsource?
- What are the best practices for my industry?
Who's Looking Out for You?
The primary mission of Marsh’s Risk Management Optimization practice is to help clients build a valued and respected RM function. A staple of the practice is our risk management function review. For clients with an existing RM function, this study provides an overview of current capabilities and activities being performed as well as a gap analysis between current and best practices. It also provides recommendations for streamlining and/or eliminating some of these responsibilities, where appropriate. Finally, it assesses the client’s current network of internal and external service providers and compares that to industry best practices.
For clients that do not currently have a RM team, this review can provide an understanding of best practices and the value that such a function can bring to an organization. It also identifies those responsibilities currently being outsourced to vendors and then helps clients reach consensus on those it wants to handle internally versus those that will continue to be performed externally.
There are several reasons to conduct a risk management function review, including:
- A client is considering outsourcing its current RM function
- A new risk manager wants a clear understanding of his/her team’s current activities and how they can be streamlined
- A client is seeking some guidance before refilling a vacant risk manager position
- A risk manager is exploring the possible ways of expanding his/her responsibilities
- A client wants guidance on how to create a world-class RM function
- A client that has never had a RM function wants to explore the possibilities of adding it
If you have any questions or would like additional information, please contact us.
If you are seeking information about insurance and related services, please visit marsh.com.
|
|
|
|
|
