ITS 835
Chapters 26, 27
Mini-Cases on ERM and RIsk
Enterprise Risk Management
Overview
Collection of four mini-cases- we will be discussing the first two case studies 26 and 27
Leaves open ended questions
Presents real life situations
And needs for ERM
Mini-Cases
Bim Consultants Inc.
Nerds Galore
Make sure each case.
They are really short and easy to read cases
As you are reading the cases:
Keep in mind how an d why ERM is needed?
The challenges as part of the ERM implementation
How the process might be related to each other
2
Bim Consultants Inc.
Consulting firm
10 offices in Canada
3,000 staff
30 partners
Operate with the “Customers are number one” focus.
But revenue is static
Opportunity to buy out competitor
US competitor selling Canadian operation
Purchase would double size and sales
Negotiations must be kept confidential
No option to visit site as part of due diligence
What types of risk you see as part of the M&A Transaction?
3
Nerds Galore
Canadian IT service company
12 offices
1,000 employees
Grew from founder’s garage
Shift from small start-ups to medium size customers
Quickly realized the mid size market is more profitable.
High turnover of 20% is causing concern in Management
Decreasing customer satisfaction
Steady revenue (for now) as a result of having long standing contracts.
Despite experiencing decreased customer satisfaction, steady revenue.
Revenue likely to change if satisfaction issue not address ASAP.
Take a closer look at Risks presented, and what type of ERM framework would serve the needs to address these type of risks?
Nerds Galore, cont’d.
Hired new VP for Humana Resources (HR)
New VP for HR introduced strategy to reduce turnover rates (20%) & to improve customer satisfaction, as follows:
Attract the best talent
Retain good people
Manage talent
Optimize the use of people
Rely on outsourcers
Executive team requested workshop to explore HR risks, as follows:
Inability to recruit people with needed skills
Loss of staff with key internal knowledge
Uncompetitive labor production
Increased departures of skilled technical staff
Loss of key business know-how
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