There’s | 11 Optimize functions and process to effectively execute your risk strategy Once an organization has determined its risk response plans or strategy, it needs to optimally align its functions, allocate resources and design risk management processes to efficiently and effectively execute its strategy. Organizations have historically dispersed responsibility for risk activities to specific functions within the organization. This has resulted in silos, negatively impacting the effectiveness of risk management activities by preventing critical information from reaching key decision-makers. If a clear operating model and processes are not defined, then communication does not flow effectively through the organization. 1. Establishing a well-defined and coordinated operating model In this year’s GRC survey, respondents clearly recognized the value of a well-coordinated operating model; 67% expected activities to be well-coordinated within three years. Organizations must define clear ownership and accountability for risk activities to enable effective coordination, communication and reporting. Management owns the process of identifying, managing and monitoring overall risk to the organization. Management sets the tone at the top, fosters a risk aware culture and defines the organization’s risk strategy. Respondents identified the following as the top opportunities to enhance the way their organization manages risk: 1. B etter alignment of risk objectives with business objectives 2. Cle arer risk ownership processes and operating model 3. Impr oved ability to provide a comprehensive view of risk 4. Mor e structured and frequent risk communications to key stakeholders and decision-makers within the organization 5. Mor e effectively leveraging technology across the organization to efficiently manage risk “ Ha ving the right structure and mechanisms in place, and adapting them as needed, is critical to improve the efficiency and effectiveness of risk activities across the organization.” Michael O’Leary, EY Global Internal Audit Leader Leading organizations optimize functions and processes by: 1. Establishing a well-defined and coordinated operating model 2. Aligning the right talent and skillsets 3. Designing risk management policies and processes Optimize functions and processes Lines of defense 1 Operations and business units 2 Management assurance Board and executive management Enable coordination, communication and reporting 3 Independent assurance Operating model People Processes 2. Optimize