Business risk

People don’t give much thought to lighthouses these days.  It’s a shame because we like them - all big and flashy and that.  But the real reason we like them is that they were built to help manage risk.  If you could see it, you could avoid it.  

The same applies to business risk.  If you are aware of it, you can take steps to deal with it.  That’s where Halex comes in. We are experts in helping clients to find ways to ‘see’ and deal with risks.  We have a suite of services that can help you identify and manage risks right from the strategic through to the process / control level.

More than that, we believe that an effective risk management process should not be seen as a bureaucratic burden.  

Working with Halex, we can help you transform your risk management process into a true performance management tool - adding real value to your organisation.

Quick links

Enterprise risk management

Business is about taking risks.  If there was no risk there would be no reward.  However, if you do not properly understand the risks your business faces then you may be exposing your business to unintended damage and possible losses:  

“With the benefit of hindsight it can now be seen as the wrong price, the wrong way to pay, at the wrong time and the wrong deal” - Sir Philip Hampton, Chairman of RBS on the ABN Amro deal.  

Clearly hindsight is a wonderful thing.  But so is foresight - using an effective enterprise risk management framework.  An effective enterprise risk management framework can be invaluable in helping you to minimise unnecessary costs and avoid shocks to your business.  The key is to develop a framework that not only works but is also not overly bureaucratic - avoiding the bells and whistles that add complexity but little real value.  Members of the Halex team have experience of doing just this.  Our team has developed and implemented effective, straight-forward enterprise risk management systems for some of the UK’s largest businesses.

Working with your senior management team, we can help you define your risk management requirements, including a risk management policy, risk methodology (including definition of your risk appetite, risk responses, etc.) and reporting templates.  We can also advise on how best to roll your new risk process out into the business as well as helping you decide if you need a risk management tool.  

Halex can also assist clients to manage their risk process through facilitation of risk workshops, capture and consolidation of risk information and reporting of results.

Once your risk process is embedded, we can also give you advice and guidance on how best to integrate your enterprise risk management process with your internal audit and control self-assessment processes to create a single business assurance function.  

Change management

Projects provide management with some of their greatest challenges.  Projects by their very nature introduce change to a business, and with change comes uncertainty and risk.  It is the responsibility of the change management stream of the project to ensure a smooth transition from the old process to the new.  

Unfortunately, change management, typically in conjunction with a major project, is often done badly and can be traumatic for all involved.  Assumptions are made that people can be issued with new processes and  change will happen seamlessly.  But to the staff it appears that old ways of doing things are abandoned and new, often seemingly less effective, ways are introduced leaving staff confused and frustrated.  Worst of all, poor change management leads to a drop in business performance as staff struggle to adopt the new processes.  

Done well, change management will give your people the knowledge and skills to adopt new processes quickly and effectively, minimising the pain of transition for your staff and your business.  Effective change management mitigates the post-implementation dip in business performance that typifies a major project.  

Halex is expert in effective change management.  We can help you structure, plan and manage your change management activities throughout the life of your project - either as a member of the project team or through providing project assurance.   We have seen first hand what works and what doesn’t and can bring this experience to your project.  

Outsourcing / off-shoring

Outsourcing and off-shoring are some of the most contentious and complex projects a business can undertake.  They also have the potential to seriously damage your business if not done in a measured and controlled way as part of a wider, clearly defined business strategy.  

Unfortunately many companies go into outsourcing and/ or off-shoring with their eyes closed. There tends to be a focus on headline cost savings and less attention on the impact of major change on the business and its continued efficient operation.  Added to this is the common tendency to have a very aggressive timetable for transition.  

Done well, outsourced and off-shored services can be very efficient, leading to significant cost savings.  However, they require a change in business culture and have inherent risks that need to be fully understood before committing to the change.   

The Halex team has built up considerable experience in outsourcing and off-shoring risk management.  We understand the pitfalls your business will face and the drivers making it happen.  We can help you develop a sound business case.  We can walk you through the pros and cons of the various outsourcing and off-shoring models and we can help your business to understand the challenges your project will face and how best to reduce their impact.  Our aim is to help you minimise the negative aspects of outsourcing and off-shoring while seeking to drive some of the considerable benefits.    

Process change

Business process change is necessary.  However it can also be uncomfortable and technically challenging.  Many businesses focus on re-engineering processes to drive maximum efficiency without sufficient consideration to managing process risks.  This can lead to implementation of an extremely efficient process that is prone to error.  

The Halex philosophy is that process change should result in greater process efficiency and reliability.  Our approach ensures that business process risks are identified and adequately mitigated through an effective control framework while seeking to maximise efficient process operation.  

Halex is skilled in reviewing and re-engineering processes and can help you benefit from more efficient and reliable business processes.  Our work is often performed in conjunction with a larger business change project, such as an IT implementation.

Internal controls healthcheck

The Halex internal controls healthcheck examines the effectiveness of controls operating over your key business processes.  The healthcheck is designed to provide an assessment of both the design and operating effectiveness of your key controls and highlight where weaknesses may exist.  It is relatively quick and will provide you with an objective snapshot your control environment along with recommendations for improvement.  

The internal controls healthcheck can also be used to set a baseline of control performance against which any future improvement / deterioration in your control environment can be assessed.  This information is particularly useful:

• where an organisation is going through significant change.  For example, redundancy or restructuring.
• for preparing your annual audit plan, since it will provide current and objective risk and control information for key processes.

Controls transformation

An effective internal control framework is vital to the efficient operation of any business.  Undetected weaknesses in control design or operation may lead to process inefficiency, errors and increased business risk.  

Focusing on specific ‘higher risk’ business processes, Halex can help you understand how effectively your internal control framework addresses risk within these processes.  Our methodology starts with documentation of the process, identifying business process risks and existing controls.  We then make an assessment of how effectively this control set mitigates the identified process risks and what control remediation actions are required.  

The key benefits of our controls transformation service are that you have:

• documented (‘locked down’) business processes that can be used to train new staff and provide existing staff with improved understanding of how processes operate.  
• responsibility for operation of processes and key controls clearly assigned and monitored.  
• improved process integrity - working right first time, every time.  

We can also help you to develop a dynamic internal control framework that links approved controls to risks.  As your business process risks change (perhaps as a result of a new supplier or new products), you are able to quickly and easily re-configure your internal control framework to ensure risks are adequately mitigated.  In this way your control environment is always correctly ‘tuned’ to the risks you face.  

Control self-assessment (CSA)

Done properly, control self-assessment can form an integral and cost-effective element of your internal control framework.  Unfortunately, control self-assessment is often poorly implemented and operated meaning that it becomes a bureaucratic paper chase with little real value.  

Effective CSA provides senior management with regular, comprehensive risk information and highlights areas within the business that may require additional management attention.  In addition, control self-assessment provides current business risk information to your internal audit function, enabling them to better risk-prioritise internal audit work, rapidly identify hotspots for investigation and enhancing internal audit coverage.  

Halex can help you to design and implement an effective control self-assessment process that focuses on maximising value and minimising bureaucracy.  We have experience of a range of approaches and can assist you to implement an approach that suits your business.  We can also help you to integrate CSA information into your internal audit planning.  

Business risk consulting

A new Halex offering aimed primarily at SMEs.  If your business is not performing in the way you expect but you are struggling to build sufficient support to make the changes needed then perhaps we can help.  We often find that our clients already have a good idea of what is wrong with their business but just need the additional leverage of an objective external opinion to build consensus for change.   

Somewhat free-form in its approach, but working in close co-operation with management, we use a senior business risk consultant to consider all aspects of your business, including your strategy, business model, people, processes & controls (highlevel), products, marketing strategy and even your business culture.  Our consultant also acts as an independent conduit for shopfloor feedback to senior management.  

Our aim is to develop an overall impression of how your business is performing and where issues may lie.  Results are rapidly fed back to management along with an assessment of root causes and practical recommendations for addressing the problems identified.  

Project assurance (project audit)

Projects provide management with some of their greatest challenges.  Projects by their very nature introduce change to a business, and with change comes uncertainty and risk.  

To minimise the uncertainty and risk associated with a project, it is necessary for the project to be managed as a formal process with a blanket of internal controls wrapped around it.  With an effective internal control framework in place, the project manager will have full control of all project activities and will be able to drive the project forward - minimising risk and increasing the chances of a successful project.  

The Halex team has extensive experience of providing project assurance for large-scale IT and other projects.  We use our Project Risk Methodology and knowledge of good practice project management methodologies to assess whether your project is effectively controlled and to make recommendations for improvement.  In addition, we provide clients with a project risk assessment, identifying key project risks and linking these to root causes.  

With this information the project manager is able to remediate existing project control weaknesses and is also able to take steps to mitigate risks that might impact the project.  

Our project assurance service provides a cost effective and objective means for senior management to understand what is really happening with their key projects.  Visiting your major projects on a regular basis, we are able to verify progress, identify key risks and make practical recommendations to improve the chances of a smooth and successful implementation.