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Mastering Operational Risk Training - Workshop Day 1 (PowerPoint PPTX Slide Deck)
PowerPoint (PPTX) + Zip archive file (ZIP) 44 Slides
RISK MANAGEMENT PPT DESCRIPTION
Operational Risk is the risk of loss resulting from inadequate or failed internal processes, people, and systems or from external events. It is perhaps the most significant risk organizations face. Virtually every major loss that has taken place during the past 30 years, from Enron, Worldcom and Baring's Bank to the unauthorized trading incident at Société Générale and the subprime credit crisis, has been driven by operational failures.
Many financial institutions have spent millions of dollars trying to develop a robust framework for measuring and managing Operational Risk. Yet, in spite of this huge investment, for many organizations, developing a viable Operational Risk Management (ORM) program remains an elusive goal.
ORM involves the systematic assessment of potential operational risks, the implementation of controls to mitigate or eliminate those risks, and the continuous monitoring of the effectiveness of those controls. ORM is an important part of overall Risk Management and helps organizations to identify, evaluate, and prioritize risks in order to make informed decisions about how to allocate resources and implement controls to manage those risks. ORM is applicable to a wide range of organizations and industries, including financial services, healthcare, manufacturing, and government agencies.
This 44-slide PowerPoint is the day 1 presentation taken from a 2-day workshop called "Mastering Operational Risk – Theory & Practice (ORM in Financial Institutions)." This presentation includes the following key sections:
• Operational Risk Management Methodology
• Risk Mitigation
• Measuring and managing Operational Risk
• Models of Operational Risk
• Legal Risk
• Emerging Challenges
• Operational Risk Systems and Software
• Case Study
The training workshop presentation is designed for both aspiring and active Risk officers, VPs, MDs, heads of departments, CFOs, CRO, analysts, Operational and Risk Management staff from financial services industry – banks, insurance companies, pension funds, consultancies, software vendors operating in these sectors. It will be also useful for a Risk Manager operating in a nonfinancial sector, as well as for interim Risk Managers and consultants who want to get up to speed with a new or current risk assignment.
This product also includes 2 supplemental documents:
• Quiz/Self-assessment (Word document)
• Risk glossary (Word document)
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MARCUS OVERVIEW
This synopsis was written by Marcus [?] based on the analysis of the full 44-slide presentation.
Executive Summary
The "Mastering Operational Risk Training - Workshop Day 1" presentation is designed to equip financial institutions with essential knowledge and practical skills in Operational Risk Management (ORM). Developed by Boris Agranovich, a recognized leader in global risk management, this workshop draws on extensive experience with major organizations across various sectors. Participants will learn to identify, assess, and mitigate operational risks, utilizing proven methodologies and frameworks. This training is crucial for enhancing risk governance and ensuring compliance with regulatory standards.
Who This Is For and When to Use
• Risk management professionals in financial institutions
• Compliance officers overseeing regulatory adherence
• Senior management responsible for operational governance
• Internal auditors evaluating risk management frameworks
Best-fit moments to use this deck:
• During onboarding sessions for new risk management staff
• As a refresher for existing teams on ORM practices
• In preparation for regulatory audits or assessments
• When developing or updating risk management strategies
Learning Objectives
• Define operational risk and its significance in financial institutions
• Identify key components of an effective ORM framework
• Assess and measure operational risks using various methodologies
• Develop risk mitigation strategies tailored to specific organizational contexts
• Implement key risk indicators (KRIs) for ongoing risk monitoring
• Analyze case studies to understand real-world operational risk failures
Table of Contents
• Overview of Operational Risk Management (page 3)
• Operational Risk Methodology (page 4)
• Risk Mitigation Strategies (page 5)
• Measuring and Managing Operational Risk (page 6)
• Models of Operational Risk (page 7)
• Legal Risk Considerations (page 8)
• Emerging Challenges in ORM (page 9)
• Operational Risk Systems and Software (page 10)
• Case Studies (page 11)
Primary Topics Covered
• Operational Risk Management Methodology - A structured approach to identifying, assessing, and mitigating operational risks within financial institutions.
• Risk Mitigation Strategies - Techniques and practices for reducing the impact of identified risks on organizational operations.
• Measuring and Managing Operational Risk - Frameworks for quantifying operational risks and implementing management practices to address them effectively.
• Models of Operational Risk - Various theoretical and practical models used to understand and predict operational risk events.
• Legal Risk - Examination of legal implications and compliance requirements associated with operational risk management.
• Emerging Challenges - Discussion of current trends and challenges facing ORM in the financial sector.
• Operational Risk Systems and Software - Overview of technological tools and systems that support effective ORM practices.
Deliverables, Templates, and Tools
• ORM framework template for organizational implementation
• Risk assessment checklist for operational risk evaluation
• Key risk indicator (KRI) development guide
• Case study analysis framework for learning from past operational failures
• Risk mitigation strategy template for tailored action plans
• ORM software evaluation criteria for selecting appropriate tools
Slide Highlights
• Overview slide detailing the scope and importance of ORM in financial institutions
• Case study slides illustrating real-world operational risk failures and lessons learned
• Visual representations of the risk spectrum and its components
• Flowcharts outlining the ORM management cycle and key processes
• Summary of Basel II requirements related to operational risk
Potential Workshop Agenda
Introduction to Operational Risk Management (60 minutes)
• Overview of ORM principles and methodologies
• Discussion on the significance of ORM in financial institutions
Risk Assessment and Measurement Techniques (90 minutes)
• Identification of operational risks using case studies
• Practical exercises on measuring and managing operational risks
Mitigation Strategies and Best Practices (60 minutes)
• Development of risk mitigation plans
• Group discussions on implementing ORM frameworks
Customization Guidance
• Tailor the ORM framework template to fit specific organizational structures and processes
• Adjust case studies to reflect industry-specific operational risks
• Incorporate organizational terminology and metrics into training materials
• Modify KRI examples to align with business objectives and risk profiles
Secondary Topics Covered
• The role of technology in enhancing ORM practices
• Best practices for conducting risk self-assessments
• Strategies for fostering a risk-aware organizational culture
• Regulatory compliance and its impact on operational risk management
• The importance of continuous monitoring and reporting in ORMDocument FAQ
What is operational risk?
Operational risk refers to the potential for loss resulting from inadequate or failed internal processes, people, systems, or external events.
How can organizations measure operational risk?
Organizations can measure operational risk through various methodologies, including self-assessments, key risk indicators, and loss data analysis.
What are key risk indicators (KRIs)?
KRIs are specific metrics used to provide early warning signals regarding potential changes in the operational risk profile of an organization.
What is the significance of case studies in ORM training?
Case studies provide practical insights into real-world operational risk failures, allowing participants to learn from past mistakes and apply those lessons to their own organizations.
How can organizations tailor the ORM framework to their needs?
Organizations can customize the ORM framework by aligning it with their specific processes, risk profiles, and regulatory requirements.
What are the emerging challenges in operational risk management?
Emerging challenges include adapting to technological advancements, regulatory changes, and the increasing complexity of operational environments.
How often should risk assessments be conducted?
Risk assessments should be conducted regularly, ideally annually, or whenever significant changes occur within the organization.
What role does technology play in operational risk management?
Technology supports ORM by providing tools for data analysis, risk monitoring, and reporting, enhancing the overall effectiveness of risk management practices.
Glossary
• Operational Risk - The risk of loss resulting from inadequate or failed internal processes, people, systems, or external events.
• Key Risk Indicator (KRI) - A metric used to signal changes in the operational risk profile of an organization.
• Risk Mitigation - Strategies and actions taken to reduce the impact of identified risks.
• Basel II - An international regulatory framework for banks that includes guidelines for operational risk management.
• Risk Assessment - The process of identifying and evaluating risks to determine their potential impact.
• ORM Framework - A structured approach to managing operational risks within an organization.
• Self-Assessment - A method for evaluating operational risks through internal reviews and assessments.
• Compliance - Adherence to laws, regulations, and guidelines relevant to operational risk management.
• Loss Data Analysis - The examination of historical loss data to identify patterns and inform risk management practices.
• Technological Tools - Software and systems used to support operational risk management activities.
• Risk Culture - The shared values and behaviors within an organization that influence risk management practices.
• Emerging Risks - New or evolving risks that may impact an organization’s operations and require proactive management.
Source: Best Practices in Risk Management PowerPoint Slides: Mastering Operational Risk Training - Workshop Day 1 PowerPoint (PPTX) Presentation Slide Deck, Boris Agranovich
