Weitere ähnliche Inhalte Ähnlich wie A*Star ERM Day 2017 - Innovation & Risk Management - Marc Ronez presentation (20) Kürzlich hochgeladen (20) A*Star ERM Day 2017 - Innovation & Risk Management - Marc Ronez presentation2. Agenda for this Session
þ Clarifying the Concept of Innovation & the link with Risk
management.
þ Understand the practical implications of the risk of
changes and the challenges of generating & implementing
Innovations
þ Learn how Risk Management can help Organization
recognize & manage different types of changes and
Innovations
þ The negative unintended consequences of Human
Driven Innovations.
þ List of some good practices to follow to cope with Change
and be an Effective Risk Manager
Marc Ronez - Innovation & Risk Management - Copyright © ARiMI 2017 3
3. 1 – WHAT is INNOVATION
& what is the LINK with RISK
MANAGEMENT?
Marc Ronez - Innovation & Risk Management - Copyright © ARiMI 2017 4
4. Marc Ronez - Innovation & Risk Management - Copyright © ARiMI 2017 5
Hunter-Gatherers VS Modern Family Home & Lives
The Difference is Thousands of Years
of INNOVATIONS
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INNOVATING is all about Taking RISK
Example 1: Discovery of America
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INNOVATING is all about Taking RISK
Example 2: Launch of the Wii by Nintendo
17. RISK..
is the effect of
UNCERTAINTY on
OBJECTIVES
(ISO 31000:2009)
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19. TAKING RISK is NECESSARY to answer
THREATS, NEEDS & achieve REWARDS
However Taking Risk WITHOUT proper
Risk Management ..
… is GAMBLING!
20Marc Ronez - Innovation & Risk Management - Copyright © ARiMI 2017
20. 2 – WHY DO we NEED to
INNOVATE?
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21. Marc Ronez - Innovation & Risk Management - Copyright © ARiMI 2017 22
Is INNOVATION a NECESSITY for HUMAN SOCIETIES?
Can’t we be happy with what we
already have?
22. What Defines
SUCCESS in a
CAPITALIST
ECONOMIC
System?
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24. Marc Ronez - Innovation & Risk Management - Copyright © ARiMI 2017 25
The only Constant in Life
is…
CHANGE
27. 28
SHORTENING technology/business Cycles
Product Time Length Cycle (TCL): how much time do you have to
‘milk the cow’ before another cycle start.
1930 1940 1950 1960 1970 1980 1990 2000 2008
TLC: 25 years TCL: < 15 years TLC: < 5 years
Marc Ronez - Innovation & Risk Management - Copyright © ARiMI 2017 28
28. DISRUPTIVE Technological
Innovations
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Impact TRANSFORMATIONAL
Onset Speed within 15 Years
Mobile Banking
& Cashless
Payments
Self-drive cars
& automated
systems
AI to support
Decision-
Making
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Population – GROWTH in emerging economies &
AGING in developed countries
30. 31Marc Ronez - Innovation & Risk Management - Copyright © ARiMI 2017
Increased Pressures on Resources, human
communities & Environment
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In a world where CHANGE is the
ONLY constant, …
we need to LEARN &
ADAPT to changes
continuously!
33. In short, We Need to
INNOVATE!
Marc Ronez - Innovation & Risk Management - Copyright © ARiMI 2017 34
37. Part of the challenges have to do with HOW
organizations approach INNOVATIONS
WHAT is the
ISSUE?
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38. It has to do with the TYPES of Innovations
Marc Ronez - Innovation & Risk Management - Copyright © ARiMI 2017 39
Business
optimization
(incremental)
Product,
market,
method
innovation
Business model
innovation
You can convince BoD
of this because some
of it is familiar.
This terrifies BoD
because of uncertainty &
it cannibalise the current
business.
SUSTAINING
INCREMENTAL
SUSTAINING
RADICAL
DISRUPTIVE
RADICAL
Next Year’s car
model
Electric car
model
On-demand self
drive car
39. The Challenge posed by INNOVATION for Established
Organizations
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proven
Unproven
Unknown
High Uncertainty
Growth Potential
Cannibalization
Risk of Failure
Known Business
High certainty
Efficiency/Profit
Complementarity
Predictability
Business Model
OPTIMISE EXPLORE
Shareholders
Prefers
this
SUSTAINING
INCREMENTAL
Innovations
RADICAL or
DISRUPTIVE
Innovations
Ideas
41. Short Time Horizon = Short Term Focus
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Horizon 1 Horizon 2 Horizon 3
Businesses typically have many
projects in this horizon, which
require limited resource
invementment and deliver quickly
Businesses support fewer H2
projects against stage gates and
killings off under performers
Seen as an expensive distraction
or pipe dream H3 usually
neglected
Profit
Time (years)
?
44. Imperialism of
internal controls
Obsession
with numbers
Inability to think
out of the box
Lack of creativity &
innovation
Result of FOCUS on Protection & Sustaining
Innovations
The effect will often be deceiving and only provide pseudo-comfort
about risk.
Marc Ronez - Innovation & Risk Management - Copyright © ARiMI 2017
Defensive Risk
Management
Which consists of
overloading in structures,
processes, systems and
technologies.
45
46. Example of Disruptive Innovations – Smartphone
Cameras vs Stand alone Digital Cameras
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Cheaper, Simpler,
Smaller & More
convenient
• No need to buy a
digital camera
• Cheap: Eg built in
phones
• Store many pictures
on memory
• Can edit and share
digital picture
• Low picture quality
• Low resolution
• Low file size
capacity
Initial Inferior
Performance
Technology
Progression
Potential
• On going
improvements in
image quality,
resolution, memory
capacity and so on to
the point of
threatening highest
end markets
Disrupted Markets: Camera manufacturers
47. DISRUPTIVE Innovations Examples
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Internet Subscription
Service for videos
Online Free
Encyclopedia
Free Long Distance
Calls on Internet
Online Retailer Online Accommodation
reservation
Online Private car with
Driver Booking
48. Quiz on Innovation: What is special about the Top 20
Most Innovative Companies
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Forbes, Fast Company, BCG, MIT and so on, publish a yearly listing of the most
INNOVATIVE companies.
Nvidia
SpaceX
Amazon
23andMe
AlphabetiFlytek
Kite PharmaTencent
Regeneron
Spark Therapeutics
Face ++
First Solar
Intel
Quanergy Systems
Vestas Wind Systems
Apple
Merck
Carbon
Desktop Metal Ionis Pharmaceuticals
75% are Young Companies
49. 3 – HOW can ERM BE A BASIS for
INNOVATION & GROWTH?
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50. You Can Nurture an
Organization to be able
to LEARN & ADAPT
to changes
continuously!
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51. It can be called a..
Risk Smart Organization
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52. Industry ERM & BCM Standards / Frameworks
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þ COSO:2017 - Revised ERM Framework (US)
þ ISO 31000:2009 - Risk Management Guideline
(International)
þ ISO 22301:2012 - Societal security – Business continuity
management systems (International)
þ AS/NZS 4360:2004 - Risk Management Standard
(Australia/NZ)
þ Rating Agencies Frameworks (S&P, Moodys)
þ Consultants Frameworks (SAP, KPMG, Marsh, etc)
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Revised ERM COSO: CLEAR FOCUS on understanding
& supporting the BUSINESS MODEL
57. The Objective of Risk Management is that …
.. an organisation takes risk KNOWINGLY and
manage risk exposure INTELLIGENTLY
.. in a controlled (or balanced) manner so that the
business is viable for a longer term (SUSTAINABILITY)
while meeting the expectation of all the relevant
stakeholders by CREATING SHARED VALUE
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59. Risk &
Value
Model
The DECISION-MAKERS
Profile
The ORGANIZATION
Context
skills
Understanding the FACTORS: Personal & Environmental that
support Sound Strategic & Operational DECISION-MAKING
organizational
structure
management
systems
culture & values
experiences
moral values
Knowledge
network
attitude
behavior
Processes
Tools
& Resources
Social
networks
What are the areas of Strengths &
Weaknesses..?
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62. ARiMI Process for Managing Risk – The Key Steps
Understand the
Organization & its
Context
Risk Assessment
Risk Quantification &
Aggregation
2. Evaluation &
DECISIONS about Risk
3. SOLUTIONS
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Plan & Implement
Exercise & Test
1. DIAGNOSTIC
4.
MONITOR, MANAGE
& REVIEW
CONSULT,
COMMUNICATE
&
COORDINATE
Recovery
Management
Intervention &
Containment
Monitor, Report &
Recognize
Analysis & Learning
ARiMI
68. Look a Long-term then Short-term (3 HORIZONS)
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Horizon 1
0 to 3 years
Horizon 2
3 to 10 years
Horizon 3
10 years & Beyond
Profit
Time (years)
Next Year’s car
model
Electric car model
On-demand self-drive
car
• high growth businesses with
potential to become core
• may or may not be generating
profit today
• portfolio of embryonic
businesses and initiatives
• Will grow into H2 or be
pruned
• core business, central to company
identity
• generating majority of profit today
but eventually flattening or
declining
71. INNOVATION Process: It can be CLOSED or OPEN!
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CLOSED
Innovation
Model
Our current
market
Internal/external venture
handling
External technology
insourcing
External technology base
Other firm’s
market
Our new
market
License, spin
out, divest
Internal technology base
Our current
market
External technology base
Internal technology base
OPEN
Innovation
Model
75. 4 – The DOWNSIDE of HUMAN
DRIVEN INNOVATIONS
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As Humans GROW (need for more land, water, food,
energy and so on) all others must DECREASE
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It is also important to
consider the
NEGATIVE effects so
that they can be
managed properly.
Otherwise the
consequences could
be DISASTROUS for
us..
82. Best Countries to Go to INNOVATE
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Cornell University, INSEAD and the World Intellectual Property Organization. The full report is available at http://www.wipo.int/
publications/en/details.jsp?id=4064
#3 UK
#13 Iceland
#7 Ireland
#2 Sweden
#5 Finland
#4 USA
#15 Canada
#6 Singapore
#14 HK (China)
#1 Switzerland
# 9 Holland
#10 Germany
#8 Denmark
#12 Luxemburg
83. Risk Managing Change - Don’t Swim Naked!
þ Think Long-term if you want to build something sustainable. And
Keep Reframing. (business model & environmental scanning)
þ Assume that what can Happen will Happen! So Prepare Accordingly
þ Nurture a Risk-Aware Culture to support resilience and capacity to
Learn and Change
þ Recruit and promote people who are risk-smart and ethical
þ Develop a real Risk-adjusted Performance Management system – to
motive people to take risk effectively
þ Build in Redundancy for important resources and processes in your
system
þ Save for Rainy Days & Opportunistic investment (create capital
buffers in ‘good times’)
þ Strengthen your crisis management & Business continuity programs
& Stress-test your systems regularly
84Marc Ronez - Innovation & Risk Management - Copyright © ARiMI 2017
84. ✓ RISK QUIZ FOR YOU!
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What Kind of Risk-Taker and Manager
are YOU?
20 quick QUESTIONS and You will find the ANSWER
TAKE QUIZ NOW at www.arimi.org
85. Marc Ronez - Innovation & Risk Management - Copyright © ARiMI 2017 86
A recognized expert with more than 20 years of experience both as a practitioner &
trainer for large MNCs, Governments & Charities.
Areas of expertise include ERM, risk decision-making processes, Data Analytics,
Corporate Governance, Business Ethics, Social Responsibility, risk-aware culture, risk
communication and crisis management, Business Model/Strategy Risk Management,
corporate learning systems development.
MBA from the University of Chicago Booth, an MSc in
Insurance & a LLM from the University of La Sorbonne,
Master Degree in Advance Business Research from UNISA –
University of South Australia
Marc has an MBA from the University of Chicago Booth GSB, MSc in
Insurance from the Université De Paris I - Panthéon-Sorbonne, LL.M.
from Université Panthéon-Assas (Paris II) and Master’s Degree in
Advanced Business Practice from University of South Australia. He is a
Fellow in Applied Risk Management (FARM) from the CARM Institute.
ARiMI – Asia Risk Management Institute, ESSEC
Business School
Work
Education
86. What do I do?
I help managers & leaders to use Risk
Management to:
þ RESOLVE difficult operational and
business challenges
þ TAKE & MANAGE risks effectively to
build sustainable & profitable growth
models
Marc Ronez - Innovation & Risk Management - Copyright © ARiMI 2017 87
89. 90
For more information on ARiMI,
check our website at:
www.arimi.org
Marc Ronez - Innovation & Risk Management - Copyright © ARiMI 2017
Developing Effective Leaders & Decision-
makers for complex & volatile times
90. Important Note: Please note that that this presentation and its
contents, is the intellectual property of the Asia Risk Management
Institute Pte Ltd. It has been prepared for this A*Star ERM Day 2017
event and it cannot be used for any other purposes without the
specific written consent of the Asia Risk Management Institute.
Whilst any third party information contained in this document has
been obtained from sources believed to be reliable, no
representations are made as to its accuracy or completeness.
Further, ARiMI expressly disclaims any responsibility for liability or
loss arising from use of such information or from any of ARiMI's
comments upon it.
91Marc Ronez - Innovation & Risk Management - Copyright © ARiMI 2017