CRM Principles of Risk Management Exam Questions And Answers

CRM Principles of Risk Management Exam Questions And Answers Explain the impacts of an effective Risk Management program on an organization (6) - Answer-1. protects organization's reputation/brand 2. Increases profitability 3. Raises awareness of risk management 4. supports managerial objective 5. Improves morale and productivity 6. Improves quality, process and technology Define Traditional Risk Management (TRM). - Answer-a functional, siloed, view of risk affecting one or more areas of the organization (focuses on pure risk) Define Enterprise Risk Management (ERM). - Answer-across functional view of risks affecting all areas of the entire organization (embraces speculative risk) Describe characteristics of Traditional Risk Management (TRM) (5) - Answer-1. manages downside risks 2. oriented to cause-of-loss, tied to minimizing risk impact 3. functional siloed treatement of risk 4. risk ID and ownership with individual employee or department 5. Reactive Describe characteristics of Enterprise Risk Management (ERM) (5) - Answer-1) risk has potential upside and downside 2) tied to strategic objectives 3) cross functional treatment of risk 4) uses subject matter experts and risk committees to identify risk and spreads accountability of risk 5) proactive/opportunistic List the ERM broad categories of risk and give examples of each (4). - Answer-1.Operational Risk: related to management activities (speculative) CONTINUES...