Running a business is inherently risky; thus adjusting the optimal balance between risk and returns is imperative for business management. The primary objective of this webinar is to demonstrate the value of integrated risk management and business continuity management on achieving corporate strategic goals and objectives. Main points covered: • The identification of the opportunities for improvement of current risk and business continuity management programs; • The assessment of the adequacy of risk management and business continuity initiatives; • Explanations of the concept of Integrated Risk and Business Continuity Management; • A description of the range of risks that threaten enterprise continuity; • The incorporation of risk management needs into all business decision making and planning. Presenter: Geary W. Sikich is a seasoned risk management professional who advises private and public sector executives in developing risk buffering strategies to protect their asset base. He is also a recognized expert in the field of business continuity and crisis management planning. He is a well-known author of four books and over 410 articles, papers and presentations on crisis management and business continuity issues. His latest book, “Protecting Your Business in a Pandemic: Plans, Tools, for Maintaining Business Continuity," 2010, is available at Amazon.com. He has over 28 years of experience in competitive intelligence, crisis management consulting, business continuity planning, human resource development, infrastructure protection, risk management, business “War Gaming” and many other special projects. Organizer: Endrita Muhaxheri Date: January 23, 2018

1. Copyright 2015, Logical Management Systems, Corp., all rights reserved

2. Copyright 2015, Logical Management Systems, Corp., all rights reserved
Geary W. Sikich:
Books are available on www.Amazon.com www.alibris.com www.BarnesandNoble.com
Geary W. Sikich, Principal:
Over 28 years of experience in competitive intelligence, crisis management consulting, business
continuity planning, human resource development, infrastructure protection, risk management,
business “War Gaming” and special projects.
Areas of Expertise:
High profile business issues resolution, business continuity planning, crisis management, disaster
recovery planning, risk management, competitive intelligence analysis, business “War Gaming”.
Background:
A recognized expert in the field of business continuity and crisis management planning. Author of four
books and over 410 articles, papers and presentations on crisis management and business continuity
issues. His latest book, ”Protecting Your Business in a Pandemic: Plans, Tools, for Maintaining Business
Continuity," 2010, is available at Amazon.com.

3. Copyright 2015, Logical Management Systems, Corp., all rights reserved
Business Continuity
It means - continuation of the business
It does not mean – continuation of the business only if there is
a tornado, flood, hurricane, terrorist attack or IT problem
We need to be able to continue our operations regardless of the
“nature of the problem”
All initiatives taken to assure the survival, growth and
resilience of the enterprise Geary W. Sikich, 2002
What is Business Continuity?

4. Copyright 2015, Logical Management Systems, Corp., all rights reserved
Risk Definition in Coso* ERM 2017:
The possibility that events will occur and
affect the achievement of strategy and
business objectives.
* The Committee of Sponsoring Organizations of the Treadway Commission
What is Risk?

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What is Risk?
Some Facts to Consider:
 Risk is not static, it is fluid
 Risk probes for weaknesses to exploit
 Risk can only be temporarily mitigated
 Over time risk mitigation degrades
Currently risk is estimated by postulating hypothetical future states of the world.

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Interconnected Risk Landscape
Regulatory Fragmentation—Governments and regulators have
established more rules but expectations and enforcement are
inconsistent from one jurisdiction to another.
Information Intensity—Companies now collect and manage
exponentially more data. New risks in cyber security and customer
data privacy.
Hyper-Transparency—Instant communication channels such as
social media amplify and accelerate business conduct’s visibility.
The Extended Enterprise—Traditional “Value Chain” blurs as data
and processes become highly interconnected.
Source: CEB – Gartner

7. Copyright 2015, Logical Management Systems, Corp., all rights reserved
The significance of
Risk Management in
Business Continuity
Today

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Strategic Risks Destroy the Greatest Value
Likelihood of Occurrence Executive Time Spent
39%
13%
42%
6%86%
2%
9%
3%
Strategic Business Risks
Operational Risks
Legal & Compliance Risks
Financial Reporting Risks
Source: CEB – Gartner

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Unclear Risk Ownership
Information Security
Legal
Business Unit Staff
Data Privacy Department
Information Technology
Enterprise Risk Management
Insurance Department
Contingency Planning
Strategic Planning
Competitive Intelligence
Security Department
Chief Risk Officer
Source: CEB – Gartner

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Human Behaviors Impede Risk Management
Ill-informed Decisions by
Senior Leaders
Widespread Reluctance to
Report Problems
Risky Behaviors by
Employees
Source: CEB – Gartner

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Risks are Less Apparent Among Non-Managers
Do you understand the business
risks inherent in you role?
Senior Leaders – 62%
Mid-Managers – 49%
Non-Managers – 37%
Do senior leaders communicate
the importance of risk
management?
Senior Leaders – 58%
Mid-Managers – 41%
Non-Managers – 32%
Source: CEB – Gartner

12. Copyright 2015, Logical Management Systems, Corp., all rights reserved
Strategic
Operational
Tactical
Identified Risks –
Likelihood of Realization,
Impact and Depth of Penetration,
Touchpoints Affected,
Nonlinearity
Opacity
Reactivity
Velocity
Very Rapid
Impact of the risk would
be evident in a month
Rapid
Impact of the risk would
be evident in a quarter
Slow
Impact of the risk would
be evident in a year
RISK VELOCITY
Traditional risk assessments that
prioritize risk on probability and
impact are outpaced by the speed
at which risks move throughout the
organization.
Risk Dimensions

13. Copyright 2015, Logical Management Systems, Corp., all rights reserved
Low
High
Geo-Political
Global Workforce
Environmental
Competition
Economies
Infrastructure
Social Trends
Technology
Markets
Foreign Sources
Impact
Likelihood
Low
High
Very Rapid
Impact of the risk would
be evident in a month
Rapid
Impact of the risk would
be evident in a quarter
Slow
Impact of the risk would
be evident in a year
RISK VELOCITY
Emerging Risks – Likelihood, Impact & Velocity
Sovereign Debt
Alternatives
•Traditional risk assessments that prioritize risk on probability and impact are outpaced by
the speed at which risks move throughout the organization.
•While 70% of finance executives agree that risk velocity is a core consideration, only 11%
have introduced it into their risk assessments. Source: Deloitte; Risk Integration Strategy Council Research

14. Copyright 2015, Logical Management Systems, Corp., all rights reserved
Recognized Risk
Action
Right Action
No Action
Wrong Action
Altered Risk State
Positive Consequences
Negative Consequences
Execution Risk
Execution Risk
Variables?Outliers?Transparent Vulnerabilities?
Risk Realization
Distorted Maps of Real Risks?Linear vs. Non-Linear Thinking

15. Copyright 2015, Logical Management Systems, Corp., all rights reserved
Risk parity is an approach that focuses on the allocation of
assets to risk, usually defined by exposure, velocity and volatility
rather than allocation of assets to the risk.
The risk parity approach asserts that when asset allocations are
adjusted (leveraged or deleveraged) to the same risk level, risk
parity is created resulting in more resistance to discontinuity
events.
The principles of risk parity will be applied differently according
to the risk appetite, goals and objectives of the organization and
can yield different results for each organization over time.
Risk Parity

16. Copyright 2015, Logical Management Systems, Corp., all rights reserved
 Techniques for identifying permanent versus cyclical changes in
the external operating environment,
 Techniques for spotting and buffering risks so that the
organization has the ability to leverage risk management
activities for competitive advantage,
 Tools for stimulating the creation of options, particularly where
change is occurring rapidly and the scope for risk management
action is shifting
Seven Identified Needs

17. Copyright 2015, Logical Management Systems, Corp., all rights reserved
 Tools for stimulating the understanding of opaque risk forces that
are truly dynamic, with multiple orders of consequence effects,
 Proven tools for improving strategy, risk management, business
continuity and competitive intelligence processes, breaking
inertia, and jolting conventional risk management thinking.
 Techniques for generating and harnessing insights from big data
about risks that customers, competitors, and suppliers present to
the organization,
 Techniques for identifying and focusing the top team’s attention
on new or poorly understood risks—before it is too late and the
risk materialize (risk realization).
Seven Identified Needs

18. Copyright 2015, Logical Management Systems, Corp., all rights reserved
“90% of the information used in organizations is
internally focused and only 10% is about the
outside environment. This is exactly backwards.”
—Peter Drucker
"We're living in a world where we need to
completely understand our environment and then
look for anomalies, look for change and focus on
the change.“
—Admiral Mike Mullen, 17th Chair, Joint Chiefs of Staff
Sobering Thoughts from Two Experts

19. Copyright 2015, Logical Management Systems, Corp., all rights reserved
But, Does Having A Plan
Guarantee Success?

20. Copyright 2015, Logical Management Systems, Corp., all rights reserved
“If you keep doing what
you’ve always done – you’ll
keep getting what you’ve
always gotten.”
"From a thousand fragments
renewal is achieved, but only if you
are prepared to pick up the pieces"

21. Copyright 2015, Logical Management Systems, Corp., all rights reserved
ISO 31000
Training Courses
• ISO 31000 Introduction
1 Day Course
• ISO 31000 Foundation
2 Days Course
• ISO 31000 Risk Manager
3 Days Course
• ISO 31000 Lead Risk Manager
5 Days Course
Exam and certification fees are included in the training price.
www.pecb.com/en/education-and-certification-for-individuals/iso-31000
www.pecb.com/events

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THANK YOU
?
gsikich@logicalmanagement.com
www.logicalmanagement.com
linkedin.com/in/gearysikich
g.sikich@att.net