Operational resilience: Developing a comprehensive operational risk strategy

David Suetens, Richard Flood and Cinzia Dicorato-Rura

Journal of Risk Management in Financial Institutions, 2017, vol. 10, issue 3, 289-295

Abstract: Financial institutions have become more complex: major functions have been re-engineered and often one crucial process can touch several locations with implications for enterprise resilience. Institutions must adjust oversight practices to maintain a greater understanding of their end-to-end processes and the risk nodes that impact on the service delivery across the process. Risk practitioners have frameworks in place to measure and monitor operational risk, technology risk, cyber risk, outsourcing risk and the firm’s contingency planning. These frameworks are effective in their silos, but do not provide the holistic thinking required to address operational resilience. To service our clients and meet regulatory expectation, this paper suggests an operational resilience practice connecting much more holistically the existing risk practices. The suggested framework seeks to simplify the complex. The authors take a step back and understand the process and the interdependencies; using the concept of layers, the authors propose a scalable methodology that allows risk managers to respond to the ever evolving business requirements. Ultimately the objective is to develop a predictive risk practice that through increased transparency on risk nodes provides the basis for greater analytical capacity to anticipate pressure points on resilience.

Keywords: enterprise resilience; end-to-end process; operational risk; risk framework; risk dashboard; continuity (search for similar items in EconPapers)
JEL-codes: E5 G2 (search for similar items in EconPapers)
Date: 2017
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Persistent link: https://EconPapers.repec.org/RePEc:aza:rmfi00:y:2017:v:10:i:3:p:289-295

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