Growing My Professional Skills and Continuing My Buckeye Pride

Johnson Ainslee 2.2016By Ainslee Johnson
Senior Risk Analyst
American Municipal Power

 

 


I am a proud 2007 graduate of The Ohio State University and the Fisher College of Business. Saying you’re a proud graduate of OSU is most closely associated with cheering on the Buckeyes on Saturdays in the fall. While that still holds true, my sense of OSU pride soared to new heights in 2015. It was not because of the national football title, but because I discovered The Risk Institute at the Fisher College of Business.

I knew I wanted to be involved in the OSU center of learning, not because of my Buckeye pride, but because as a risk professional for American Municipal Power, I saw the value of this center for my professional growth. I attended my first Risk Institute Executive Education session in the spring, which focused on risk as it relates to Cyber Security. What I experienced at the session was a collaboration between academics and practitioners that benefits both those who study risk and those who practice it. I’ve witnessed how Fisher students are participating in these interactions and better preparing themselves for their careers in risk management.

As a Fisher student, I majored in finance and used that as my springboard to finding context around corporate data. My strong analytical background drew me to the risk models of organizations and a career in risk management. My time at Fisher taught me to be a lifelong learner, and I truly appreciate how Fisher is supporting o-h-i-omy continued growth even after graduation through the resources of The Risk Institute.

A career in risk has presented a new set of challenges and opportunities. I have a more broad view of the organization and work to use that knowledge base as a tool to overcome departmental barriers. The Risk Institute, with its foundation of collaboration, provides a unique and valuable forum for practitioners and academics to exchange ideas and learn from a broad cross section of industries. As new partners are added and sources of insight are brought into the discussion, the impact will grow.

The Risk Institute is a tremendous asset right in our backyard. I look forward to being active as both an alum – with the chance to give back and help mold the next generation of risk practitioners – and also as a risk manager – who sees a tremendous opportunity to identify and evolve best practices as well as expand my skill set.


Find out how you can get involved, by visiting http://fisher.osu.edu/centers/risk.

Who are Your Disrupters?

Jim McCormick photoBy Jim McCormick
Founder and President
Research Institute for Risk Intelligence

 

 


So, let’s say you’ve decided that you need to cause some disruption in your industry.  You have come to see the value of the mantra of The Risk Institute and want to “leverage risk to create value.”

Likely at the core of your decision is the need to strengthen your competitive advantage.  Perhaps you need to respond more quickly and effectively to changes in the competitive environment such as –

  • new competition from unexpected sources,
  • competitors with new products, offerings or distribution channels, or
  • competitors with cost structures you cannot currently match.

Or perhaps you need to be more responsive to changes in the marketplace like –

  • new payment methods,
  • generational preference changes, or
  • transient customers or clients with no loyalty.

It may be that you need to up your game on the innovation front and develop more new products, services and methods.

So, who do you put on the team that is going to drive the disruption?

  • All risk-takers so they will charge ahead?
  • Perhaps people who are all risk-adverse so they won’t do anything crazy?
  • Or a healthy mix to achieve some balance?

But how do you know even know the Risk Inclination of your people?

At the Research Institute for Risk Intelligence, we have spent a lot of time and effort studying personal risk inclination.  Because like The Risk Institute at Ohio State, we feel it is vital that organizations move away from conventional risk management and its emphasis on minimizing risk to the more current approach of utilizing risk.  And that process of utilizing risk to create or respond to disruption requires understanding the risk inclination of your people.

Because fueling innovation, inspiring initiative and attaining organizational agility are not just desirable – they are now mandatory if your organization is going to survive and prevail in today’s hyper-competitive, technology-accelerated, global world of business.

At The Risk Institute’s annual conference October 7 and 8 I will discuss these issues and provide insights that will help you answer these questions.  I will present insights based on our research into personal risk inclination that will help you better lead and persuade.

 

The Risk Institute 2014 Survey – Evolving the Conversation

minton bernadette 130x195By Professor Bernadette A. Minton
Academic Director, The Risk Institute
Arthur E. Shepard Endowed Professor in Insurance
The Ohio State University Fisher College of Business 

 


Last week, The Risk Institute released its first annual Survey on Integrated Risk Management.  As my colleagues and I reviewed the survey results, we agreed that they provided insights into three aspects of risk management:

  • Senior executives’ views about the role of risk management in their firms
  • The structure of risk management functions
  • How firms integrate risk management into business decisions

Yet, we also agreed that the results raised several questions, including:

  1. Are firms’ risk management approaches really integrated or are they just aspirational? On the one hand, firms say they view their risk management approach to be integrated, meaning they stress its use across the firm and recognize it to be a source of growth opportunities and not just a reactive or defensive strategy. Yet, further survey questions about how they integrate risk management into business decision-making show that such integration is piecemeal and does not extend to all functional areas or units.
  2. If a firm reports the recognition of risk management as the source of growth and as the most important catalyst for their increased risk management efforts over the last three years, why does the audit committee have the primary responsibility for risk management? The executive committee and/or strategy committee of the board understand the drivers of firm value and set the corporate objectives to enhance firm value. However, firms rarely reported that these committees are responsible for risk management at the board level.
  3. Why are business functional areas like marketing, sales, human resources or research and development not more involved in risk management processes? These functional areas have large amounts of data that can help firms understand risks to their corporate objectives as well as help identify emerging risks.
  4. If balancing risks to create value means mitigating risks at times and leveraging risks at other times, why are firms not using mechanisms to set the scope of risk taking consistent with this view?

At The Risk Institute, we are dedicated to advancing the adoption of leading risk management strategies by leveraging the collaboration between academic scholars and RiskInstitute_block Dpractitioners. As we work to provide insights into the questions raised by the survey, we look forward to continuing the conversation on the evolving role of risk management through: new areas of research; translations of completed academic research for practical business applications; and educational programs for business professionals, undergraduate and graduate level students.  Through these dialogues, we can collectively advance our knowledge of risk management and influence adoption of leading risk management practices.


To learn more and access the complete 2014 Survey on Integrated Risk Management, visit: go.osu.edu/2014RiskSurvey

A Snapshot of Risk Management in 2015

minton bernadette 130x195By Professor Bernadette A. Minton
Academic Director, The Risk Institute
Arthur E. Shepard Endowed Professor in Insurance
The Ohio State University Fisher College of Business 

 


As published on Columbus CEO’s CEO Live blog on May 20, 2015

In recent years, risk management has evolved into a more comprehensive and integrated practice.  Risk management was once viewed as only being done to meet regulatory requirements and to protect the firm against the negative effects of volatility in their business environment.  While those aspects remain leading catalysts for firms who increased risk management efforts over the last three years, a fraction of firms recognize risk management to be a source of growth.

Over the same three-year period, senior executives and the board of directors have become more involved in risk management processes. This integrated approach leverages collaboration across an organization to identify and evaluate risks and to proactively manage those risks to achieve corporate objectives and enhance shareholder value.

One of the primary goals for The Risk Institute at The Ohio State University Fisher College of Business is to create a greater understanding of how organizations can proactively leverage risk management to create value.  Given the varied roles that risk management plays in different organizations, it is important to hear from senior executives from both financial and nonfinancial industries about how they view risk management’s role in their organization. It’s also critical to understand how executives, if at all, integrate risk management into business decisions as well as structure their risk management function to support its role in the firm.

Organizations are increasingly impacted by risks that are more interconnected and ever changing. This means that the conversation about risk and risk management must continue to evolve and grow. It is with this goal in mind that The Risk Institute developed a comprehensive research initiative to survey senior risk management executives. The survey is designed to deepen the understanding of how U.S. companies structure their risk management practices.

The annual Risk Management Survey is one example of how The Risk Institute and its founding partners are committed to moving this conversation forward. In this inaugural survey, we provide a snapshot of risk management practices among a large and diverse set of U.S. firms.

As The Risk Institute unveils the findings from its inaugural 2014 Risk Institute Survey on Integrated Risk Management several things are clear.

 1) In order for firms to transition to a more integrated risk management approach, which views risk management as a source of value enhancing opportunities, it is important to choose a leader of the risk management functions who embraces this view and who does not see risk management as merely a defensive strategy. Equally important is choosing a leader who can effectively collaborate with other C-suite executives to leverage risk to enhance shareholder value.  Finally, the Board committee responsible for risk management also should share this view.

2) For firms wanting a more integrated risk management approach, it is important to include more business units/functions in the processes and not only rely on those functions related to finances and meeting mandated requirements. Aligning risk management with key organizational strategies will aid an organization to successfully develop a fully integrated risk management function that can leverage risk to achieve corporate objectives and enhance growth and shareholder value.

3) For firms to fully reap the benefits of an integrated approach, not only do they need to recognize a business process and analyze the risks of that process, they must also increase their efforts to have their analysis feeding back into the risk management of the firm itself. This “looping” process will allow firms to proactively manage the risks impacting their organizations and identify emerging risks to be leveraged or mitigated.

4) Given the changing nature of risks impacting firms, firms must continue to use a variety of techniques like best case/worse case and extreme scenario analyses, which can effectively evaluate these risks by including proprietary models and simulations.

5) As firms move from viewing risk management as a defensive strategy to a more fully integrated approach, senior executives and the Board must develop mechanisms to set the scope of risk-taking that are consistent with this latter view of risk management.

These findings afford some great insights and will enable us to investigate and address challenges in the practice of risk management so to advance the adoption of leading integrated risk management strategies.


To learn more and access the complete 2014 Survey on Integrated Risk management, visit: go.osu.edu/2014RiskSurvey