Master of Science in Risk Management (ERM)
Today’s businesses face risks unlike any other period in time. Technology, with all its innovation and benefits, also brings tremendous risks that must be addressed.
Cyber-security breaches erode profits and reputations. Innovative tech startups are always trying to disrupt business.
Complex financial products and financial engineering can mean millions in potential losses without proper controls. These fears are what make Enterprise Risk Management (ERM) such a fast growing concept in business today.
But what is ERM? Enterprise Risk Management, ERM, is a management technique focusing on identifying, mitigating and preventing various business risks.
Risk can be anything that keeps an organization from achieving its goals. These include strategic, operational, regulatory and financial risks. ERM also applies to the way risk is viewed. Looking at all of a business’s risks together, like a portfolio leads to more effective use of resources and risk mitigation.
What is an Online MBA in ERM?
The MBA in Enterprise Risk Management, ERM, is a graduate level program of online curriculum focused on evaluating and measuring risk in the business world. Most online MBA in ERM programs provide core business courses, followed by three ERM concentration courses. For example, Johns Hopkins University – MBA in Enterprise Risk Management (On Campus) focuses on core issues that affect risk management now and in the future, including:
Supply chain resilience
The concentration classes in ERM typically address the key risks businesses face. The curriculum focuses on the qualitative and quantitative aspects of assessing risk with the goal of determining a measurable risk tolerance level. This can range from studying the corporate culture of a firm to the amount and structure of loans a bank holds.
A key component of the curriculum should be a study with real world examples. This is typically addressed in the final course as students actually perform a risk assessment complete with recommendations to reduce risks to an acceptable level.
What Kind of Jobs Can I Get with a Degree in ERM?
If you’re pursuing a career in finance, a degree in ERM can go a long way. A qualified risk management professional should always be in demand as firms face a myriad of operational, regulatory and compliance risks. If you’re already in finance, it shows both initiative and responsibility which could put you on the management track.
A Master’s Degree in Risk Management gives graduates a valuable overview into the operations of all of a company’s departments that could eventually translate into a C-Suite position, Chief Risk Officer.
Popular jobs in ERM include risk manager, insurance claim adjuster, personal financial advisor and auditor. Risk managers enjoy a median pay of $82,151, according to Payscale.2 The insurance industry as a whole specializes in risk management, so it’s no surprise that many insurance professionals pursue graduates from a risk management degree.
Insurance claims adjusters often require risk management experience as they work with insurance brokers handling various claims. Personal financial advisors have to assess their client’s risks throughout the different stages of their lives, and potentially their heirs. Auditors manage risk by actively reviewing internal processes, financial statement completeness, and regulatory compliance.
How Do I Choose the Right Risk Management Degree for You?
You should consider your time frame when selecting a program. Leaving work for your MBA can result in a large opportunity cost. Ideally, you want an accelerated timetable and flexibility.
Pursuing a degree online gives many professionals the flexibility they need. Schools such as Johns Hopkins’ Carey Business School offers a MS in Enterprise Risk Management degree that is designed for the working professional. Their part-time program gives you the flexibility to complete your degree during evenings and weekends.
Ideally, you want to find a school where the curriculum includes a student project that will mimic a real-world problem. There are plenty of examples of risk management lapses usable for case studies. Look how a cyber-security breach affected retailer Target’s reputation. Not addressing strategic risk caused movie rental giant Blockbuster to get steamrolled by nimbler upstarts like Netflix.
A lack of financial control in accounting resulted in Enron collapsing. Improper technology controls and testing caused Wall Street firm Knight Capital to almost go out of business.3
You may also consider an Enterprise Risk Management Certification. There are various certificates to choose from but many deal with compliance of ISO 31000, a set of risk management standards created by the International Organization for Standardization in the wake of the financial crisis in 2009.4
A proactive enterprise risk management system gives an organization a competitive advantage. Often, companies feel they don’t have adequate resources to devote to a thorough risk management plan. But in today’s business environment, not having a risk management plan may be the biggest risk of all.