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Karen Hardy
Enterprise Risk Management
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Enterprise Risk Management
A GUIDE FOR GOVERNMENT PROFESSIONALS
Dr. Karen Hardy
Foreword by Allen Runnels
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Library of Congress Cataloging-in-Publication Data
Library of Congress Cataloging-in-Publication Data has been applied for and is on file with the Library of Congress.
ISBN 978-1-118-91102-0 (cloth); ISBN 978-1-118-91103-7 (ebk.); ISBN 978-1-118-91112-9 (ebk.)
FOREWORD
Karen Hardy understands the value proposition associated with the practice of enterprise risk management (ERM). With this book, oriented toward informing the federal workforce about ERM, she has contributed significantly to expanding the body of knowledge about this extremely important subject. The insights she shares can help encourage and empower the federal workforce at all levels to identify, assess, and manage risk effectively. She writes from both thought-leader and practitioner points of view and focuses upon the need to advance the practice of enterprise risk management in the federal government. She gives readers specific examples of what the practice of risk management looks like in agency operations, and she also includes information about tools available to help manage risk. For the few current champions of risk management in government, this book lays the groundwork for enabling them to obtain buy-in from their agency leadership. For agencies without a champion, it provides an easy-to-read road map that answers the basic question of why organizations should adopt the practice of ERM.
As risk in government becomes more dynamic and complex, managers must become more enlightened and equipped to effectively plan for it, anticipate it, and manage it. The huge balance of the federal debt and the lack of political cooperation to resolve it have led to the sequestration of federal funds, driving drastic reductions in resources available to agencies to accomplish their missions. Federal executives and managers have been asked to do more with less for the last several years, a situation that generates even more risk in the execution of government programs and services. In her book, Karen Hardy asserts that for agencies to best navigate their way through these uncertain times and effectively accomplish their missions, they need to develop an enterprise-wide approach to risk management wherein everyone in the organization becomes a risk manager.
Karen Hardy has done a stellar job of introducing the subject of ERM to the federal workforce. She seamlessly guides the government risk manager through an extraordinary step-by-step review of all the pieces that make up ERM as a management tool. Her book should be mandatory reading for the federal workforce, because it can fill a huge knowledge gap regarding the value of ERM in contributing to the effectiveness of government. Those tasked with designing, implementing, and sustaining ERM at their agencies will find her book a much-needed reference in their ERM toolbox. Without her book, the practice of risk management in government would lack a key perspective from a real practitioner who not only writes about the subject matter but also is applying it. Karen gives readers an opportunity to understand the value of ERM for best accomplishing agency missions and programs, and, more important, how to apply it in their organizations.
Thanks to Karen Hardy for her efforts in making such a tremendous contribution to the practice of enterprise risk management in government.
Allen Runnels
President
Association for Federal Enterprise Risk Management
PREFACE: MANAGING RISK IN THE CURRENT FEDERAL ENVIRONMENT
It has been said that the only thing constant is change and the risks and opportunities that come with it. Over the past century, we have seen constant change in every aspect of life. Traditions that were once seen as mainstays and permanent fixtures in our society are now distant memories. Thanks to changes in technology and social norms, the ways in which