Risk, Strategy, and Decision Making

Catalog description

One of the key ways that a business attempts to manage risk it anticipates and confronts in markets is through organizational-level elements such as its business strategy, structure, and culture. These elements emerge from a series of decisions guided by the insights and biases of individuals. As such, the management of enterprise risk must also include an understanding of how individuals (e.g. managers) approach risk through their decisions and decision making processes. In this course, we look at some of these critical elements separately and then together as they integrate to guide and define enterprise risk management. The basic course objectives are to come away with an understanding of the following: Forms of strategic risk - From market to internally-driven risk; from emotional to economic-driven, how does strategic risk present itself? How do executives recognize/assess and respond to the "portfolio of risk" that they must address to make the business successful? Business strategy and structure - One way risk is addressed and articulated is through a business strategy. What is strategy? What are the key decisions that comprise a business strategy? How are organizations structured to implement these strategies and move information across the firm? Where and how is risk assessed in these processes and structures, and incorporated into a strategic risk plan? Decision making - Decision making around strategy and risk management plays out in various forms and across different levels (i.e., individuals and groups). What goes right and wrong? How are these processes systematically linked to perceptions and actions associated with risk management. Organizational culture - Perhaps one of the most critical elements in enterprise risk management is the role played by organizational culture (or simply "How we do things around here and my role as an organizational member doing it.") We examine the roots of organizational culture and how it is aligned to perspectives of risk and its management. Descriptive vs. prescriptive perspectives - Once we "described" what does/could go on, we need to engage in looking at ways that organizations can prevent pitfalls and correct suboptimal practices.