Enterprise Risk Scenarios and Stress-Test Overview

Risk is the effect of uncertainty on your objectives. You are clear on what you are trying to achieve – but how clear are you on all the vectors where internal or external risks can combine to cause material harm to your business or blind you to emerging opportunity? History shows these killer risks and opportunities are often foreseeable. Developing, maintaining and stress-testing improbable but value destroying business scenarios is critical to ensure ongoing resilience and avoiding your own ‘Kodak moment’.

How we can help

We have a portfolio of risk and technology experts on-hand to work with you to develop meaningful business (and major project) risk based scenarios. Using our proven methodologies and domain experience, we can quickly work with key subject matter experts across your business to develop fit-for-purpose risk scenario models that really do facilitate better executive and board level decision making.

We can work with you to build scenario models that take relevant inputs from the external environment, your existing data sets, including; your risk profiles, risk appetite settings and tolerances, investment priorities and business plans. These scenario models provide pragmatic and usable insights that help you monitor and manage the things that matter most.

Well-developed and meaningful scenario models are used in three key ways:

1. to help with the strategic planning and development process;
2. to support your understanding and monitoring of your most critical enterprise risks; and
3. in the effective set up and governance of major business projects, where new or emerging risks combine with existing exposures to create heightened project design and delivery risk.

An effective and ‘fit-for-purpose’ risk scenario methodology is more than a timely risk exposure monitoring tool – it is also an integral part of your overall Risk Management Framework, which is the most important decision support tool you have.

Key areas of focus

Our team can help you:

• Identify the priority areas where risk scenario models can help you identify both emerging business opportunity and the vectors for potentially value destroying risks – see the things than matter most
• Develop the six to eight scenarios that most effectively represent the viable future realities relevant to the strategy, risk or project you care most about
• Identify the leading and lagging indicators and metrics to support the current status of each of the scenarios, and the ‘so what’ of that to business decision making, within the guide rails of your existing risk appetite framework
• Stress-test the underlying business processes, systems, risks, and controls performance data to ensure those critical metrics, which support material business or project decisions, are built on reasonable foundations
• Train your own staff in the use of a practical and very cost-effective risk scenario toolkit so they can continue to apply this methodology as BAU

Get actionable and meaningful insights

Whichever service or support we deliver, we will provide you with a report that presents a meaningful view of your organisation’s emerging risk profile and the measures required to safeguard your business. The report includes:

• Actionable insights based on our engagement and industry expertise
• Where relevant, benchmarking data to call out leading or lagging behaviours
• Overall risk rating, based on our self-assessment of your business risk