Enterprise Risk Management (ERM) Framework 2020

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Richard Swartzbaugh
End-to-End
Talent Management

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Executive Summary
The underlying premise of enterprise risk management is that the Company exists to provide value for its stakeholders –
residents, patients, employees, and shareholders. Like any business, the Company faces some uncertainty, and the challenge for
management is to determine how much uncertainty to accept as it strives to grow stakeholder value. Uncertainty presents both risk
and opportunity, with the potential to erode or enhance value. Enterprise risk management enables VC’s senior management to
effectively deal with uncertainty and associated risk and opportunity, enhancing the capacity to build value. Value is maximized
when management sets strategy and objectives to strike an optimal balance between growth and return goals and related risks, and
efficiently and effectively deploys resources in pursuit of the entity’s objectives. These capabilities inherent in enterprise risk
management help management achieve the Company’s performance and profitability targets, and minimize loss of resources.
Enterprise risk management helps ensure effective reporting and compliance with laws and regulations, and helps avoid damage to
the Company’s reputation and associated consequences. In sum, enterprise risk management helps the Company get to where it
wants to go and avoid pitfalls and surprises along the way. Enterprise risk management encompasses:
• Aligning Risk Appetite and Strategy – Management considers the entity’s risk appetite in evaluating strategic alternatives,
setting related objectives, and developing mechanisms to manage related risks.
• Enhancing Risk Response Decisions –Enterprise risk management provides the rigor to identify and select among
alternative risk responses – risk avoidance, reduction, sharing, and acceptance.
• Reducing Operational Surprises and Losses – Entities gain enhanced capability to identify potential events and establish
responses, reducing surprises and associated costs or losses.
• Identifying and Managing Multiple and Cross-Enterprise Risks – Every enterprise faces a myriad of risks affecting different
parts of the organization, and enterprise risk management facilitates effective response to the interrelated impacts, and integrated
responses to multiple risks.
• Seizing Opportunities – By considering a full range of potential events, management is positioned to identify and
proactively realize opportunities.
• Improving Deployment of Capital – Obtaining robust risk information allows management to effectively assess overall
capital needs and enhance capital allocation.
• Leveraging Talent, Structure, Process, and Capital – To become the provider of choice, and employer of choice in the
markets we serve.
Enterprise Risk Management (ERM)
1. Enterprise Risk Management — Integrated Framework. Executive Summary, 2014. Copyright © 2004 by the Committee of Sponsoring Organizations of the Treadway
Commission. All rights reserved.

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Executive Summary ………………………………………………………………………........................... 2
1. Performance Excellence ……………………………………………………………………………….... 4
2. Enterprise Risk Management Framework (COSO) .………………………………………………… 5
3. SWOT Assessment ……………………………………………………………………………………... 22
4. Talent Sort ……………………………………………………………………………………………….. 26
5. Sample Tools …………………………………………………………………………………………… 28
TMS Table of Contents Page(s)

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1. Performance Excellence – Baldrige
Workforce Focus
© 2020 National Institute of Standards and Technology (NIST).

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Enterprise Risk Management Framework - COSO
© 2020 https://www.coso.org/Documents/2017-COSO-ERM-Integrating-with-Strategy-and-Performance-Executive-Summary.pdf
https://na.theiia.org/standards-guidance/topics/documents/executive_summary.pdf

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Enterprise Risk Management Framework - COSO
© 2020 https://www.coso.org/Documents/2017-COSO-ERM-Integrating-with-Strategy-and-Performance-Executive-Summary.pdf
https://na.theiia.org/standards-guidance/topics/documents/executive_summary.pdf

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2. Enterprise Risk Management Framework - COSO
© 2020 http://www.coso.org/documents/COSO-2015-3LOD-PDF.pdf

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© 2020 coso.org
Risk Categories
►Strategic
►Market &
Liquidity
►Legal
►Credit
►Reputational
►Operational
ERM Process
(IAMMRTI)
►Identify
►Assess
►Mitigate
►Measure
►Report
►Test/Evaluate
►Internal Controls
IAMMRTI Tools
►Compliance
►Solutions:
Avoid, Transfer,
Mitigate, Control,
Share, Accept,
Diversify
►Talent
►Reporting
►Training
►Planning
►Governance
►Controls
►Policies,
Procedures,
Practices
►Org. Culture

21© 2020 coso.org
Top 10 talent-related business risks:
An insufficient pipeline of future leaders
A lack of depth of internal candidates for critical roles
Difficulties in recruiting top talent
Salary expectations of candidates with critical skills become too high
Difficulties in retaining key people
An insufficient budget for managing and developing talent
Skills and capabilities required by the business in the near future are not developed
A lack of compelling development opportunities for top talent
Business leaders’ inability to engage with, motivate, and nurture business critical talent
Managers view performance management/talent reviews as processes to comply with,
not business critical activities

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3. Enterprise Risk Management Framework – SWOT Framework

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# Strengths
1
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10
# Weaknesses
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3
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10
# Opportunities
1
2
3
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9
10
# Threats
1
2
3
4
5
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9
10

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3. Enterprise Risk Management Framework – Sample Completed SWOT Framework
STRENGTHS
 Admissions/Marketing department
 Patient satisfaction
 Therapy team
 Cleanliness of community
 New ED, SSD
 Support and positive attitude of Medical
Director
WEAKNESSES
 Internet connectivity
 Leadership of DON
 Nursing skills
 Overtime/Double time %
 Staff retention
 Reputation with Identity Medical
Group/Valley Care IPA
 2 Stars
OPPORTUNITIES
 More training: Licensed Nursing Staff
increase competencies
 Accepting clinically complex patients
 Rate change with Gold Coast and
dedicated bed program
 Increase Advisory/physician board (ortho
and MD from Identity)
 Road to Recovery and other programs –
72 hr observation unit, etc.
 Improve dining experience/physical plant
 Online presences – update website –
individual community websites
THREATS
 Competition – Greenfield (Fillmore) –
renovations of dining and resident rooms
http://www.gccfillmore.com/ - functional
website
 Competitor SNFs paying more for NOC
CNAs.

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4. Talent Sort

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4. Talent Sort

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5. Sample Tools
© 2020 coso.org

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5. Sample Tools
© 2020 coso.org

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5. Sample Tools
© 2020 coso.org

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5. Sample Tools
© 2020 coso.org

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5. Sample Tools
© 2020 coso.org

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5. Sample Tools
© 2020 coso.org

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5. Sample Tools
© 2020 coso.org

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5. Sample Tools
© 2020 coso.org

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5. Sample Tools
© 2020 coso.org

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5. Sample Tools
© 2020 coso.org

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5. Sample Tools
© 2020 coso.org

Enterprise Risk Management (ERM) Framework 2020

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