Question

How does ERM adoption and implementation in the higher education environment differ from the for-profit environment? Why is culture important to consider when implementing ERM?

Required:

1. Provide an initial posting of at least 300 words
2. Use formal writing using the technical language of Risk Management.
3. Respond by extending the discussion by adding new insights, different examples from your experience, or from other sources.
4. Apply critical thinking. Superficial agreements, quoting other learners, or repeating the case content will count as zero words and zero points.
5. Probing questions or challenging assumptions are strongly encouraged for maximum points.

Answer 1

ERM adoption and implementation v/s forprofit environment

ERM adoption & implementation in the higher education environment is very important when we consider the amount of risk borne by colleges and universities. If we consider colleges to be small cities and other departments to be different buildings, then there will be so many missions to be performed. Each department will have their own targets which will benefit to all of them and not only to the colleges/university. Forprofit environment are entirely different from ERM. A Forprofit organization is the one whose main goal is to make money i.e. to earn profit. e.g. restaurant & super markets etc. In terms of authority a forprofit will probably have only one person utilizing power and disbursing it, while every one alse accepts the changes.   

   For implementing ERM Culture is very important as it dictates how a possible reaction can occur. It is always risky to implementing anything new because it is being introduced to an entire group of diverse people. Any risk associated with introducing a new idea can be elimimated if we adopt good and positive culture in the company.

Risk Management:

Risk management occurs when an investor or fund manager suffers a loss in their organization. It is a process of identification, analysis, acceptance or mitigation of uncertainty in investment decisions. It is inseperable from return from the world of investment. Standard deviation and statistical measure of dispersion around a central tendency is one of the way to ascertain risk. Beta and Alpha are other examples of risk management

Example of Risk management:

Risk mangement can be closely associated with various types of risk in the field of information technology, quality of life, space technology and safety oriented risks etc. Here I am citing an example of information & technological risks like social networking, mobile devices and user computing, cloud computing etc.

These days there is a rapid expansion and their function which is introducing a new risk in these devices like

1. There is a loss or release of critical business data.

2. It also includes security and identity management.

3. Application development challenges.

4. ERP integration issues.

All these risks continue in technology which increases the strategic importance and risk to organization. Risk is also created by rapid deployment of emerging technology etc. Managing risk is very different from managing strategies. Risk management focuses on the negative threats and failures rather than opportunities and successes.