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Cloud computing has come a long way from being a mere buzzword to a meaningful tool with a lot of potential for consumers of technology products and services.
Just as in the early days of the Internet, there are many unknown variables in cloud computing. Company A’s core competency is performing software development, not providing hosting solutions. To conduct a risk-based assessment of the cloud computing environment, there are generic risk frameworks such as the Committee of Sponsoring Organizations of the Treadway Commission (COSO) Enterprise Risk Management—Integrated Framework. The IS auditor of Company A chose the Risk IT framework, supplemented with an understanding of the Cloud Controls Matrix, ENISA’s cloud computing risk assessment and the NIST guidelines. Risk IT provides a list of 36 generic high-level risk scenarios, which can be adapted for each organization. Leveraging Risk IT in conjunction with a widely accepted IT governance and controls framework such as COBIT makes the risk identification robust and the risk assessment process effective and efficient. Once the risks and COBIT control objectives were defined, they were used by the IS auditor to develop a risk-based audit program.
Due to competing resources, the prioritization of risks related to cloud computing needs to occur, and appropriate action should be taken based on the risk appetite of the company. Once the company aligns IT risk with the organization’s overall business risk and remediates unacceptable security controls, the company is better prepared to harness the power of cloud computing. Opinions expressed in the ISACA Journal represent the views of the authors and advertisers.
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THIS WEBSITE USES INFORMATION GATHERING TOOLS INCLUDING COOKIES, AND OTHER SIMILAR TECHNOLOGY. When updates are required to the register, Planning and Business Intelligence will activate the workflow, which will send out notifications to all relevant departments.
When checked, Shutterstock's safe search screens restricted content and excludes it from your search results. Where FMEA, fault tree and other risk management methods drill down to the tiniest detail, Bow Tie methods allow for a broader view of risk throughout the enterprise.
The approach differs from the more established methods in that it allows for a higher-level view into potential risks at the enterprise level. How and when the method originated is not completely clear, but the first Bow Tie risk diagrams are said to have appeared at the UK petrochemicals company, ICI, in lecture notes taken from a hazard analysis course given at the University of Queensland, Australia in 1979.
In 1988, a catastrophic incident on the Piper Alpha oil platform in Scotland’s North Sea, which killed 167 men, served as a wakeup call to the oil and gas industry, prompting companies to adopt better risk-management practices. Within the past decade, the method has moved beyond oil and gas to other industries, including aviation, chemical and healthcare, including pharma. Bow Tie was created by combining two fairly well-known risk analysis tools: Fault Trees and Event Trees. During the top event, a hazard is released, and that release may be only the first event in a chain of negative events with undesired consequences. The goal is to prevent that top event, and subsequent events that can lead to losses and damage.
Consequences, in Bow Tie methodology, are defined as unwanted events resulting from release of the hazard. The next step is defining  preventive measures, or barriers that would prevent events from happening. This article was meant as a brief introduction to the Bow Tie risk assessment and management method.
To summarize, Bow Tie is another risk management tool available to pharmaceutical manufacturers today, to help prevent noncompliance, damage and loss. Allow organizations to dig deeper into implicit knowledge throughout the enterprise, and make it explicit. Because it is visual and intuitive, and gives an overview, it can be easily understood by all layers in any organization. The goal, Ray said, is to drive decisions on the most important issues, and the areas that might be most vulnerable. Figure 4 shows a hypothetical example of how Bow Tie analysis would treat the potential risk of off-label promotion.
Work so far has shown that the same or similar threats can appear in multiple business activities, so Bow Tie analyses can be linked, Ray said.
At this point, he explains, Celgene is identifying data to inform the control framework, including audits, operations, processes, records, and reports.
Anecdotal data is also being collected, including observations and notes from employee interviews. Robert Dodd spent several years at Quantas, and managed his own consulting firm providing aviation safety management and regulatory advice.
Great management and clear guidance are not the only tools that a company can use to improve productivity and efficiency among employees. If you could change a few things on your project to vastly increase your chance of success, wouldn’t you do it? We've gone through the topic of why use the mind mapping technique for your project management efforts before.
The recent PwC Global PPM Survey pointed out some interesting facts about the trends we’re seeing across project and programme delivery. There are definitely benefits to being hired on as a full time and permanent project manager. We all spend a lot of time in meetings, either virtually or in person, so you really need them to be a good use of your time. The copyright of this content belongs to the Seavus Group and any liability with regards to infringement of intellectual property rights remains with them. An additional and very important part of risk management, which relates to step 3 and 4, is to make a risk register (or risk log) that captures and track the identified risks and the risk mitigations.
Addressing the aspect of people risk is the only way an organisation can improve the way their people respond to a situation of risk and the effectiveness of their risk management function.
Enter your email address to subscribe to this blog and receive notifications of new posts by email. The Client: A multi-billion dollar financial services provider with operations across the world with millions of customers. Being a complex organization with multiple business units and operations spread across geographies, the company found it increasingly complex to measure and monitor risks. After analyzing the situation, the company chose to implement a federated approach to Operational Risk Management (ORM), supported and enabled by a workflow-based ORM solution. At a broad level, the company's operational risk assessment process begins with the risk administrator preparing an RCSA plan and schedule, based on which the operational risk managers assess their business unit's risks and controls. But whatever the approach to RCSAs, all business units use the same risk language and nomenclature to describe operational risk drivers, correlation bundles1, controls, control objectives, and reliance maturity2.


Given that risk events can be unpredictable as well as subject to constant change, the company enables continuous and recurring risk assessments. Several internal and external factors such as a change in policy, or a restructuring of the management team have a direct impact on risk management at various levels of the organization.
Each operational risk manager has access to powerful graphical dashboards which provide real-time insights into all risks, issues, losses, KRIs, BEAs, and other critical information in the business unit.
Similar to the ORM dashboard is a landing page in the ORM solution which provides operational risk managers with a complete overview of their business unit's risk profile. At a broad level, the landing page contains top-level risk categories, events, number of controls, number of issues, number of KRIs, number of loss events, and other such critical data that can be quickly navigated through.
Since risk managers are located in different geographies, and may therefore speak different languages, the landing page provides multi-lingual support, in addition to being intuitive and easy-to-use. Most organizations measure their inherent risk in terms of impact and likelihood, expressed as a 2x2 framework.
A specific group in the organization uploads the risk data based on changing currency rates. In its risk data dictionary, the company maintains a comprehensive list of control objectives i.e. All RCSA, loss management, and BEA processes eventually link to issue management in a closed-loop approach.
The company implemented MetricStream ORM Solution to support and enable their risk management strategy. Powerful dashboards and reports to help risk managers gain better risk visibility and thereby better risk control. Tools such as executive risk dashboards and a centralized risk landing page offer a quick, high-level overview of risk and control data which can then be drilled down to analyze details. The risk data dictionary has helped the company implement a common risk language across business units.
The company can measure and analyze their risk not only in terms of impact and likelihood, but also parameters such as currency and velocity. The company has been able to streamline end-to-end risk processes, right from risk assessment, to risk tracking, risk reporting, control assessments, loss management, KRI monitoring, and issue management.
Due to its nebulous nature, it is important to understand the risks associated with utilizing cloud computing.
Infrastructure as a Service (IaaS) cloud service providers (CSPs) specialize in providing hosting solutions. The cloud’s economies of scale and flexibility are both a friend and a foe from a security point of view.4 The chief information officer (CIO) of the company engaged an information systems (IS) auditor to conduct a review and assess the risks of offering a SaaS solution and adopting IaaS cloud computing for this arrangement. There are also IT domain-specific risk frameworks, practices and process models such as ISO 27001 and IT Infrastructure Library (ITIL). Starting with the set of generic risk scenarios helps ensure that the IS auditor does not overlook risks and attains a more comprehensive view of IT risk. This leads to a model that is extensible and reusable and that can scale up to IT risks affecting the entire company. Figures 3–105 represent a selection of the audit program for the higher-risk areas in figure 2. However, implementing too many controls may not be the best risk-mitigation approach because the benefit from implementing controls should outweigh the cost.
This case study represents a one-time attempt at risk assessment of the cloud computing arrangement. He has an extensive background in designing, implementing and assessing IT controls in various industries and third-party service organizations. To read the most current ISACA Journal articles, become a member or subscribe to the Journal.
Membership in the association, a voluntary organization serving IT governance professionals, entitles one to receive an annual subscription to the ISACA Journal. For other copying, reprint or republication, permission must be obtained in writing from the association. The system will work inline with the Low Level Risk Register, and will have an identical look, and function in almost exactly the same way. Tasks will be created for these departments to enable progress monitoring, since all work is carried on the same document.
From the workflow summary screen, users can see all the tasks that have been issued to departments and whether they have been completed or not.
Today, a growing number of drug companies are applying modern risk management methods, including FMEA, HAZOP, Fault Tree and Fishbone analysis, to ensure control over day-to-day risks. Where Fault Tree and other methods can get very detailed and specific, in some cases down to the level of the individual valve, Bow Tie allows for a quick overview, and can facilitate communication about risk with both senior management and the plant floor.
Shell facilitated extensive research in the application of the Bow Tie method and developed its own best practices for applying the method.
For instance, a glass of water isn’t dangerous in itself, but if you knock it over it could destroy your laptop or electronics. A barrier can be any measure taken that acts against some undesirable force or intention, in order to maintain a desired state.
An example would be an earthquake, which could lead to cracking in the protective concrete floor surrounding pipelines.
These barriers do not operate directly on the possible cause but act upon the possible escalation factors.
This data typically resides in individual business functions, and is process or workflow oriented. As a General Manager with Australia’s Civil Aviation Safety Authority, he helped guide the newly formed organization into a new world of system based safety regulation. Although risk assessments were being performed regularly in every business unit, complexities arose when it came to consolidating the results. Stakeholders from different groups such as Compliance, Audit, Vendor Governance, and Risk Management came together to discuss what to do, how best to go about it, and what technology solution to implement. Each business unit has the flexibility to implement their own approach to RCSAs such that it is relevant to the risks they face.
All these risk terms are clearly defined and stored in a centralized risk data dictionary that can be accessed by operational risk managers across the globe while preparing their risk reports. Users can view risks by category and organizational tier, and identify if there needs to be a re-assessment of a risk driver, a loss scenario, inherent risk, controls, or any other elements. The result is a a€?freeze-framea€? picture of risks which enables operational risk managers to identify and analyze risk trends effectively.
Any risk manager who logs into the system can quickly and easily understand the risk profile without having to click on several different links and tabs. But since the company deals specifically with finance, they opted to express risk impact in terms of other dimensions such as currency i.e. Risk velocity adds a third dimension to the traditional model of risk impact and likelihood, and refers to the speed of occurrence of a particular risk impacting the organization.


In fact, there are many other processes and functions such as Compliance and Audits which also integrate with issue management. This comprehensive picture of risk enables operational risk managers to proactively identify and address opportunities, as well as areas of concern. Thus when the management team at the company headquarters looks at the consolidated RCSA results, they get a clear and comprehensive understanding of the enterprise risk profile.
This helps them understand and prioritize their risks better, and determine which ones need to be mitigated immediately, and which ones can be transformed into opportunities. This structured approach helps minimize redundancies and duplicate effort, and improves the cost-efficiency of risk management. Leveraging an IaaS CSP for hosting has allowed Company A to remain focused on its core competency. The following paragraphs describe the steps followed by the IS auditor to conduct the exercise.
Bottom-up guidance specific to cloud computing also exists from various bodies such as the Cloud Security Alliance (CSA), European Network and Information Security Agency (ENISA), and the US National Institute of Standards and Technology (NIST).
Further, Risk IT offers an extensive mapping between the generic risk scenarios and the COBIT control objectives that are customizable for each situation. Other risk-mitigation measures such as transferring, avoiding or accepting the risk are worth considering as well.
The risk assessment helped uncover some of the key risks, prioritize those risks and formulate a plan of action. Gadia is also an editorial advisor for the monthly Journal of Accountancy from the American Institute of Certified Public Accountants (AICPA). As with the Low Level Register, editing will be limited to one person at a time to prevent saving errors. Should users need to send additional documentation to support their entries on the register, there are links on the form and in the notification emails to do this. Should users not complete their tasks before the due date, reminder emails will be sent periodically to encourage them to complete the task. The company’s main motivation was assuring that appropriate risk barriers were put in place, consistently, throughout all of its global operations.
They do that by featuring combinations of conditions, so that, based on a particular combination, a certain consequence can occur. These are events because you try to prevent them from happening because you are afraid of the potential consequences. Bob consults for a number of different industries, including pharmaceuticals and healthcare.
Each business unit used different risk terminologies and languages, which made it challenging to get a holistic picture of risk at the enterprise level. Eventually, the company developed a comprehensive ORM strategy, and implemented a solution that focused on strengthening existing ORM processes, standardizing the risk language, and gaining an integrated risk view. This kind of flexibility is important because a risk such as credit risk which is critical to one business unit may not be relevant to the other. This allows risk administrators to route the BEA to concerned risk managers in their team who, in turn, can either accept or reject the BEA depending on how it impacts their organization or their risk management processes.
This top-level risk view helps risk managers focus their attention on the most critical risk areas.
There are also control objective ratings which tell the organization whether or not all the required controls are in place, and how important they are to the overall risk category. If each function uses different terminologies for these issues and the associated risks, then reporting becomes complicated.
With SaaS, customers enjoy all the benefits of cloud solutions such as not having to host their software in-house2 (figure 1). This exercise will help the CIO in determining what Company A needs to protect, prioritizing the risks and determining a response. The Cloud Controls Matrix released by CSA is designed to provide security principles to guide cloud vendors and assist prospective cloud clients in assessing overall security risks of a CSP.
Figure 2 illustrates the mapping between the high-level risk scenarios and the corresponding COBIT control objectives created by the IS auditor for the cloud computing arrangement. Given the evolving nature of risks in cloud computing, no longer can one-time risk assessments suffice. Send payment to the CCC stating the ISSN (1526-7407), date, volume, and first and last page number of each article. With MediumRisk team members have instant access to the most up to date project risk information, and the project management team always has an accurate overview of the most critical issues and the pending actions for implementing the necessary risk mitigations.
Advanced drill-down capabilities help the risk managers view the data at any level of granularity, and proactively identify and analyze risk triggers (e.g. For instance, a user in Europe will see the risk impact expressed in terms of Euros while his or her counterpart in the U.S. So, by measuring risk velocity, the company can determine how quickly a risk might occur, how fast they will be impacted by it, and how much time they will have to prepare and react. A strong control objective rating indicates that the needed controls are in place, while a bad control objective rating indicates that some controls are missing for a particular risk category. To avoid this challenge, all functions refer to the same risk data dictionary for enterprise-wide issue reporting. The NIST guidelines on security and privacy in public cloud computing (NIST Special Publication [SP] 800-144), which are currently in draft form, contain the guidelines required to address public cloud security and privacy.
As newer risks emerge, risk assessments need to evolve and the mitigation approach needs to innovate. Copying for other than personal use or internal reference, or of articles or columns not owned by the association without express permission of the association or the copyright owner is expressly prohibited. And if any of the issues pose an operational risk, the ORM group gets notified immediately. The Risk IT:  Based on COBIT® framework from ISACA fills the gap between generic risk management frameworks and domain-specific frameworks based on the premise that IT risk is not purely a technical issue. A risk assessment needs to occur before an enterprise enters into a cloud computing arrangement—to help avoid surprises and minimize the costs of implementing and maintaining controls. Analysis Risk analysis is the process of determining which threats are of greatest concern.
By combining these control ratings with overall control objective ratings, the organization gets a complete picture of the adequacy of the control environment for a particular risk category.



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