Chapter 3 presented the approach Mars, Incorporated used to implement ERM, and chapter 5 presented the University of California Health System’s ERM development. In what ways are the two organization’s approaches to ERM similar? How do they differ? Choose one aspect of each ERM implementation from which the other organization would benefit and explain why. word count 300+ To complete this assignment, you must do the following: As indicated above, describe in what ways the two organization’s approaches to ERM are similar. Also, explain how they differ. Choose one aspect of each ERM implementation from which the other organization would benefit and explain why. Textbook(s) Required: Fraser, J., Simkins, B., & Narvaez, K. (2014). Implementing enterprise risk management: Case studies and best practices. John Wiley & Sons Additional details: Student should complete all required portions of the discussion assignment. Assignment strongly demonstrates graduate-level proficiency in organization, grammar, and style Assignment is well written, and ideas are well developed and explained. Demonstrates strong writing skills. Student paid close attention to spelling and punctuation. Sentences and paragraphs are grammatically correct. Proper use of APA formatting. Properly and explicitly cited outside resources. Reference list matches citations.

Introduction:

Enterprise Risk Management (ERM) is a strategic approach that enables organizations to identify, assess, and mitigate risks to achieve their objectives. In this discussion, we will compare the ERM implementations of Mars, Incorporated and the University of California Health System. We will analyze the similarities and differences in their approaches and identify one aspect from each implementation that the other organization would benefit from.

Similarities between Mars, Incorporated and University of California Health System’s ERM approaches:

Both Mars, Incorporated and the University of California Health System recognized the need for a structured ERM framework to manage risks effectively. They approached ERM as a strategic initiative that would integrate risk management into their organizations’ activities. Additionally, both organizations utilized a top-down approach to implement ERM, starting with commitment and support from senior leadership. This demonstrated a shared understanding of the importance of leadership’s role in driving the culture of risk management.

Furthermore, both Mars, Incorporated and the University of California Health System emphasized the importance of risk assessment and prioritization. They established processes to identify and evaluate risks, considering their potential impacts on the achievement of organizational objectives. This common focus on risk assessment highlights a fundamental principle of ERM, which is to proactively manage risks rather than reactively addressing them.

Differences between Mars, Incorporated and University of California Health System’s ERM approaches:

While there are similarities, there are also notable differences between Mars, Incorporated and the University of California Health System’s ERM approaches. Firstly, their organizational contexts differ significantly. Mars, Incorporated is a multinational corporation operating in the consumer goods industry, whereas the University of California Health System is a healthcare organization within the public sector. These contextual differences influenced the specific risks they faced and the approaches they took to address them.

Secondly, the scope of their ERM implementations differed. Mars, Incorporated implemented ERM across its global operations, whereas the University of California Health System focused on its health system entities. The difference in scope reflects the varying complexities and organizational structures of the two organizations. Mars, Incorporated’s global operations necessitated a broader framework to manage risks across multiple business units and regions.

Another notable difference is the maturity level of their ERM implementations. Mars, Incorporated had a more established ERM program with several years of experience, while the University of California Health System was in the earlier stages of developing its ERM capabilities. This difference in maturity level is likely to have influenced the depth and sophistication of their ERM processes and practices.

Aspect from Mars, Incorporated’s ERM implementation that University of California Health System would benefit from:

The University of California Health System would benefit from adopting Mars, Incorporated’s comprehensive approach to risk categorization. Mars, Incorporated categorized risks into four broad categories: strategic, operational, financial, and hazard. This categorization allowed for a holistic understanding of risks across different dimensions, enabling the organization to allocate appropriate resources and develop targeted risk mitigation strategies. By adopting this aspect of Mars, Incorporated’s ERM implementation, the University of California Health System could enhance its risk identification and assessment processes, gaining a more nuanced view of the risks it faces.

Aspect from University of California Health System’s ERM implementation that Mars, Incorporated would benefit from:

On the other hand, Mars, Incorporated could benefit from the University of California Health System’s emphasis on integrating ERM into decision-making processes. The University of California Health System integrated ERM into its strategic planning and budgeting activities, ensuring that risk considerations were incorporated into key decisions. Mars, Incorporated could leverage this approach to strengthen its decision-making processes, ensuring that risks are appropriately considered and managed at all levels of the organization.

Conclusion:

In conclusion, Mars, Incorporated and the University of California Health System share similarities in their approach to ERM, such as their recognition of the need for a structured framework and their focus on risk assessment. However, differences exist in their organizational context, scope, and maturity level of their ERM implementations. The University of California Health System would benefit from Mars, Incorporated’s comprehensive risk categorization, while Mars, Incorporated could benefit from the integration of ERM into decision-making processes demonstrated by the University of California Health System. By learning from each other’s strengths, both organizations can enhance their ERM capabilities.