« Transformation of Risk IT Function |
Main
| More Regulations Pain or Panaceas? »
April 20, 2010
Remembering CK Prahalad , The Father of Core Competency
Looking back at the recent Financial Crisis, Risk Pundits often ponder how Risk can become an integral part of financial institution’s strategy – strategy for growth and not mere survival strategy. Extending this thought to " Risk Management as the Core Competency of a firm? ” would be interesting to discuss.
Every Bank, Financial firm is today busy redesigning their risk practice, right from Risk Identification to Reporting every stage is being observed and dissected with minute analysis. We all are busy in building new and better Risk management practice which can enable business to grow stronger and provide sustainable competitive advantage. Competitive advantage naturally attracts and leads to what C K Prahalad and Gary Hemel coined as “ Core Competency”. Going by the copybook definition in Wikipedia : “A core competency is a specific factor that a business sees as being central to the way it, or its employees, works. It fulfills three key criteria:
1. It provides consumer benefits
2. It is not easy for competitors to imitate
3. It can be leveraged widely to many products and markets.”
Can any Financial Institution or Firm stand up today and say Risk Management Practice they have is core competency for them. Right from approaching towards Risk as strategy, Identification, Valuation, Governance, management to risk reporting - Does each such step encompasses unique value proposition which competitors find it difficult to emulate or adopt.
Plausible approach to build Risk as Core Competency?
• The leadership at the top has to make its intent clear about risk as a strategy. It has to be clearly communicated across organization regularly.
• The leadership also has to align this vision with people, processes, IT systems and even align with each bit of business execution it does so that whole DNA of the organization gets configured to the new vision, strategy and its execution.
• Organization is a huge wealth of knowledge – so it is better to reuse already established best practices around risk and look for the feasibility to extend such practices to other businesses.
• Work with ecosystem – Keeping Risk as central theme for Strategy involve Board, Investors, Clients, Business Partners, Broker dealers, Custodian etc. (all key stakeholders) to co create product and service offering to the market place harnessing its core competency – better Risk mgmt. practice compare to its competitors. Strategy has to be implemented by creating an ecosystem where all stakeholders buy-in and participation are there.
Finally core competency development is not a short term goal, it is a long term investment to build sustainable competitive advantage for a firm. To build risk mgmt. as core competency it requires paradigm shift in leadership thought process as well as the organizational culture has to be tuned to new strategic changes. It demands commitment ,discipline ,rigor and passion to excel as a leader.
Posted by kb0905 at April 20, 2010 01:48 PM
definitely is pleasant data need to know additional
Posted by: Calandra Henigan at August 2, 2010 06:56 PM
I love your blog.. very nice colors & theme. Did you create this website yourself or did you hire someone to do it for you? Plz reply back as I'm looking to create my own blog and would like to know wheere u got this from. thanks
Posted by: WP Robot Discount Code at December 19, 2010 05:38 AM
Keep focusing on your blog. I love how we can all express our feelings. This is an extremely nice blog here :)
Posted by: WP Robot Discount Code at December 19, 2010 10:20 AM
This is the best blog I've ever seen in my life! I really appreciate you taking the time out of your busy day to share your this with everyone.
Posted by: Backlinks at December 27, 2010 09:09 AM
Hello blogger, good morning. Gorgeous blog post. You have gained a new reader. Pleasee keep it up and I look forward to more of your incredible articles. Regard
Posted by: bodybuilding at January 11, 2011 10:05 PM
I found your site from altavista and it is eye-popping. Thank you for sharing such an incredible article...
Posted by: order generic Allegra at January 17, 2011 11:16 PM
I feel like you could probably teach a class on how to make a great blog. This is fantastic! I have to say, what really got me was your design. You certainly know how to make your blog more than just a rant about an issue. Youve made it possible for people to connect. Good for you, because not that many people know what theyre doing.
Posted by: cheap Zyvox canada at January 19, 2011 07:52 AM
Thanks for taking the time to talk about this, I feel fervently about this and I take pleasure in learning about this topic. Please, as you gain information, please update this blog with more information. I have found it very useful.
Posted by: buy cheap Cipro at January 20, 2011 05:19 AM
I enjoyed reading your blog. Plenty of great comments on this web site! Keep up to date the excellent work. Looking towards up coming post!!
Posted by: sell beats at January 25, 2011 03:32 AM
Can I just say what a relief to find someone who actually knows what theyre talking about on the internet. You definitely know how to bring an issue to light and make it important. More people need to read this and understand this side of the story. I cant believe youre not more popular because you definitely have the gift.
Posted by: Funny video clips at January 25, 2011 04:55 PM
Just wanted to let you know how much I enjoyed reading this ;D
Posted by: watch the hills online at February 2, 2011 01:04 AM
These reasonably post are perpetually inspiring and that I prefer to read quality content thus I happy to find many sensible point here in the post, writing is simply nice, thank you for the post
Posted by: Theodore Mettille at February 2, 2011 10:47 AM
Hello. magnificent job. I did not anticipate this. this can be an incredible story. Thanks
Posted by: Carmela Vargason at March 7, 2011 09:15 PM
What would we do minus the wonderful ideas you share on this website? Who has got the patience to deal with critical topics for the sake of common subscribers like me? I and my buddies are very fortunate to have your site among the types we often visit. Hopefully you know how very much we appreciate your effort! Best wishes from us all.
Posted by: Chicas Sexis at April 5, 2011 05:51 PM
I must say that overall I am really impressed with this blog.It is easy to see that you are passionate about your writing. If only I had your writing ability I look forward to more updates and will be returning.
Posted by: supplement reviews at April 5, 2011 07:27 PM
Found your blog on Twitter, and I just wanted to say that I appreciated the information!
Posted by: Clay Garriss at May 24, 2011 10:15 PM
Hello, Great job. I did not expect this just before the weekend. Thanks
Posted by: Keith Beabout at June 13, 2011 01:07 AM
Post a comment
