The Certified Risk Management Officer
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About this ebook
This book discusses risk management processes associated with operational risk, risk governance, project risks, tools and techniques for risk assessment, strategies for risk responses, reserves and contingencies, and risk monitoring and control. Leadership management and business communications are the soft skills that are required to become a successful risk manager.
Individuals with several years of experience practising enterprise risk management are encouraged to acquire this certification. This book is the primary source of reference to prepare candidates for the CRMO examination that is offered online.
Stand tall above the crowd with the Certified Risk Management Officer ™ certification.
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The Certified Risk Management Officer - Zulk Shamsuddin
INTRODUCTION
The Certified Risk Management Officer ™ (CRMO) is a gold-class certification that demonstrates the attainment of a defined level of technical knowledge in enterprise risk management, professional practice, and ethical behaviour. It forms the basis of the assessment that applicants must pass to gain the Certified Risk Management Officer recognition and inclusion in the Register of the Global Academy of Finance and Management ® Certified / Chartered Professional.
This book discusses risk management processes associated with operational risk, risk governance, project risks, tools and techniques for risk assessment, strategies for risk responses, reserves and contingencies, and risk monitoring and control. Leadership management and business communications are the soft skills that are required to become a successful risk manager.
Individuals with several years of experience practising enterprise risk management are encouraged to acquire this certification. This book is the primary source of reference to prepare candidates for the CRMO examination that is offered online.
Stand tall above the crowd with the Certified Risk Management Officer ™ certification.
Benefits of becoming a Certified Risk Management Officer
Personal recognition from your peers in enterprise risk and/or project risk management profession.
Enhanced CV to stand out in the job market.
A framework for the development of your career.
International recognition.
Assurance for clients of high standards and ethical practice.
Use of the post-nominal CRMO or Certified Risk Management Officer ™
Increased understanding, helping you to work more effectively.
Introduce yourself with this exclusive membership card during networking, business events, conferences, anywhere. Membership has its privileges.
How To Acquire the Certified Risk Management Officer Certification?
Certified Risk Management Officer generally needs a bachelor’s degree, or some other related discipline. Employers typically seek a minimum of three years of professional experience in risk management. Candidate with a Certified Risk Management Officer certification is especially attractive.
Application for Certification
https://gafm.com.my/application-for-certification/
A Certified Risk Management Officer ™ is an experienced risk consultant who has earned the accredited gold-standard Chartered Risk Management credential from The Global Academy of Finance and Management ®. This credential is a senior-level certification and is only offered to individuals with several years of experience in enterprise risk management, project risk management, or operational risk management. The Certified Risk Management Officer ™ certification program is designed to deliver a deep, practical understanding of risk management framework, processes and measurement methodologies for the successful execution and implementation of risk management processes.
Certified Risk Management Officer Responsibilities
Provide a methodology to identify and analyze the financial impact of loss to the organization as a result of inefficient enterprise risk management.
Examine the use of realistic and cost-effective methods to identify project risk.
Identify and prioritize risk in a project
Capture risks and record them in a project risk register
Allocate budgets for liabilities and contingencies.
Monitor and control risks, and assess the impact of risk to project budgets.
Provides risk management reporting to project sponsor and senior management.
Risk is an Important Function of Project Management
Risk management is basically an approach in which we explore identify, analyze and mitigate the risks that can affect our project. Risk management is an important part of project management which if done efficiently leads to the success of your project. Risk management is an action plan that consists of various steps that are done to ensure the removal of risk. If you are dealing with uncontrollable risk then you may set an action plan that can minimize the effect of these risks as you cannot fully get rid of such risks.
Risk management is done by risk managers who are well aware of all the risks associated with any particular business or project and different ways to mitigate them. As this is the age of multitasking, various organizations also expect project managers to be risk managers as well. In fact, large numbers of project management institutions are offering risk management courses for project managers. The courses not only help you to know the types and nature of project risks but also various techniques used to deal with these risks. The risk mitigation technique to be used depends on the nature of project risk faced by your team so you must be very careful in developing an action plan for fighting against risks.
Risk management is the essence of project management. It increases the chances of your success to a great extent. Following are some of the benefits of developing and implementing an efficient Risk Management Plan while working on any project.
Helps you to avoid any big disaster
Enhances your revenues by saving your expenses
Provides you mental satisfaction
Ensures the successful completion of project
Gives you competitive edge over others
Increases the sense of responsibility and accountability
Helps you to explore new opportunities
Certified Risk Management Officer Skills
Certified Risk Management Officer should be self-motivated, extremely organized, and have strong communication and project management aptitude. Employers typically seek candidates with a bachelor’s degree, an engineering certification, and the following skills:
Risk Management skills – Risk managers need a strong understanding of risk processes and the cost of managing risk in projects
Strategic planning – the primary job of risk manager is determining the best possible risk mitigation plan for a project to get completed on time and within budget
Project management –understanding how to identify and assess risks to ensure project completion within the timeframe and budget allotted
Teamwork – risk manager interacts effectively with cross-functional team members and external stakeholders at various levels of responsibility
Mathematical skills – High levels of mathematical skills and risk analysis are critical to the performance of this role
Communication skills – Risk Consultants need strong verbal and written skills to provide reports to clients and stakeholders as well as articulate complex risk management plans to team members
Computer skills – Risk managers use specialized computer software for project management purposes, and also to produce visual presentations, using bar charts and graphs to explain the impact of risks to key project activities.
One common attribute of all projects is that they eventually end. Think back to one of your favorite projects. The project started with a desire to change something within an organization. The idea to change this 'something' was mulled around, kicked around, and researched until someone with power deemed it a good idea to move forward and implement the project. As the project progressed towards completion there were some very visible phases within the project life. Each phase within the life of the project created a deliverable. For example, consider a project to build a new warehouse. The construction company has some pretty clear phases within this project: research, blueprints, approvals and permits, breaking ground, laying the foundation, and so on. Each phase, big or small, results in some accomplishment that everyone can look to and say, 'Hey! We're making progress!' Eventually the project is completed and the warehouse is put into production.
At the beginning of the project, through planning, research, experience, and expert judgment, the project manager and the project team will plot out when each phase should begin, when it should end, and the related deliverables that will come from each phase. Often, the deliverable of each phase is called a milestone. The milestone is a significant point in the schedule that allows the stakeholders to see how far the project has progressed and how far the project has to go to reach completion.
Examining the Project Life Cycle
By now, you're more than familiar with the concept of a project's life cycle. You also know each project is different and that there are some attributes common across all project life cycles. For example, the concept of breaking the project apart into manageable phases to move towards completion is typical across most projects. As we've discussed, at the completion of a project phase, an inspection or audit is usually completed. This inspection confirms the project is in alignment with the requirements and expectations of the customer. If the results of the audit or briefing are not in alignment, then rework can happen, new expectations may be formulated, or the project may be killed.
Working through the Project Life Cycle
Project life cycles, comprised of phases, move the project along. Project life cycles allow a project manager to determine several things about the project, such as:
What work will be completed in each phase of the project?
What resources, people, equipment, and facilities will be needed within each phase?
What are the expected deliverables of each phase?
What is the expected cost to complete a project phase?
Which phases contain the highest amount of risk?
Armed with the appropriate information for each project phase, the project manager can plan for cost, schedules, resource availability, risk management, and other project management activities to ensure that the project progresses successfully.
Characteristics of a Project
Most projects have similar characteristics, such as the following:
They Are Demanding
The stakeholders, the people with a vested interest in the project, are all going to have different expectations, needs, and requests for the project deliverables. No doubt there will be conflict between the stakeholders.
They Have Clear Requirements
Projects should have a clearly defined set of requirements. These requirements will set the bar for the actual product or service created by the project, the quality of the project, and the timeliness of the project's completion.
They Come with Assumptions
Projects also have assumptions. Assumptions are beliefs held to be true, but that haven't been proven. For example, the project may be operating under the assumption that the project team will have access to do the work at any time during the workday, rather than only in the evenings or weekends.
Constraints Are Imposed
Within every project there is a driving force for the project. You've probably experienced some force first-hand. For example, ever had a project that had to be done by an exact date or you'd face fines and fees? This is a schedule constraint. Or a project that could not go over its set budget? This is a financial constraint. Or what about a project that had to hit an exact level of quality regardless of how long the project took? This is a scope constraint. All are forces that tend to be in competition with each other.
Project Constraints
Project constraints influence practically all areas of the project process. Consider constraints as a ruling requirement over the project. Common constraints you'll encounter are time constraints in the form of deadlines and the availability of resources.
Specifically, there are four major constraints that a project manager will encounter:
SCOPE
The scope of the project constitutes the parameters of what the project will, and will not, include. As the project progresses, the stakeholders may try to change the project scope to include more requirements than what was originally planned for (commonly called scope creep). Of course, if you change the project scope to include more deliverables, the project will likely need more time and/or money to be completed.
SCHEDULE
This is the expected time when the project will be completed. Realistic schedules don't come easily. As you may have experienced, some projects require a definite end date rather than, or in addition to, a definite budget. For example, imagine a manufacturer creating a new product for a tradeshow. The tradeshow is not going to change