Redefining (and Clarifying) ERM & ORM

by | Jul 28, 2021

Enterprise risk management, or ERM for short, refers to the philosophy and practice of identifying and assessing uncertainties to manage risks and seize opportunities related to the achievement of organizational objectives. There are several programs that fall under the “umbrella” of ERM including risk governance, strategic risk management, business unit risk management, operational and compliance risk management (ORM), among others.

A successful risk management program stretches across the different layers of business units within an organization or credit union. Each layer is part of the broader ERM ecosystem, but each has its own set of unique objectives and purposes.

Traditionally, ERM is a blanket term for various functions and tasks at the strategic and business objective levels. Risks at this level focuses on the implications of potential events that may serve harmful to the achievement of strategic and business unit objectives. Operational risk is the risk of loss resulting from inadequate or failed internal processes, people and systems or from external events. This type of risk is inherent in all products, activities, processes, and systems. When operational risks are realized, they can cause business disruption, failure to achieve objectives, financial loss and reputational damage. Because of that, ORM focuses on specific regulatory, project and product risk mitigation efforts to ensure risk controls are effective and happening as designed.

Rochdale’s Solutions – GRC system (apogee iQ)

Rochdale offers a risk-driven GRC system that allows for the centralized management of the full breadth of a credit union’s risk efforts. Specifically related to this posting, there is both an ERM (strategic and business level) module and a new ORM module.

The purpose of the ERM module is to arm your risk management team with the information needed to advise management and the board for improved strategic positioning and strategic progress. The module assists your credit union in evaluating, managing, and reporting potential events—both internally and externally—that that may offer opportunities to identify new growth, cost savings, or improved mitigation possibilities. apogee iQ’s ERM module improves organizational performance by eliminating information silos, standardizes risk methodologies, and allows for ease in administering your ERM program. This module solves the difficulties of informing management with the necessary intelligence to holistically make prioritized, strategic and business-level decisions for improved organizational performance.

Our ORM module, instead, solves the growing need for assessing and managing risks associated with credit union regulatory, operational, product and project mitigation efforts. It provides an easier, more effective, and consistent way to manage your credit union’s operational risk by providing a centralized dashboard from which you can track, manage, and monitor all risk assessments and their associated observations. ORM provides a library of templated and customizable risk assessments to ease administration and maintain best practices.

Mitigating risks, day-to-day operations, and business objectives can be challenging in both resources and in execution. apogee iQ’s ERM and ORM modules are stand-alone modules, but work together to manage your full set of risk management programs (strategic, management, operational). We encourage the use of both modules to inform and augment one another to ensure a comprehensive view of risk across the organization. Our full suite of modules, including VM (Vendor Management), form an extensive risk management program that can help drive improved decision making across all business units in your credit union.

Contact us today to schedule a conversation or demo of our apogee iQ platform.