STRATEGY CONSULTING GROUP

 
 
              SCG

RISK MANAGEMENT & STRATEGY EXECUTION

Risk Management is the identification, quantification, and proactive management of risks—and it is a key factor for value creation in all industries. Given today’s unstable two-speed economy, every business needs to evaluate and improve its risk-management capabilities.

 

In financial services, the greatest risks include credit risk generated by lending activities; market and counterparty risk generated by trading activities (notably, derivatives trading); liquidity risk generated by mismatched assets and liabilities; operational risk caused by error and omission in core systems and processes; and the risks associated with writing insurance contracts for objects, businesses, and people.

 

Given the effects of the financial crisis and today’s market and economic environment, financial institutions must answer some important questions:

  • How can an institution efficiently manage and employ its financial resources (funding and liquidity, capital)?

  • How can the effectiveness of risk management be improved? What requirements does this imply for governance, systems, and infrastructure?

  • What is the impact of new regulatory requirements (such as Basel III, Solvency II, and International Financial Reporting Standard 9)?

  • How can an institution identify the most important risks it faces—and how can they be made transparent and managed?

 

Over the last decade, SCG has built a robust global team of risk experts. The team covers all major financial centers, including Frankfurt, London, Paris, Hong Kong, and New York, as well as all major risk domains: regulation, analytics, governance and organization, culture and process, and systems redesign. Naturally, our risk expertise also dovetails with SCG’s core competencies: planning, steering, and strategy for senior executive management.

 

Our Risk Management practice has five main areas of focus:

  • Office of the Chief Risk Officer. Defining a conceptual framework and organization for the steering of funding and liquidity, capital management, definition of risk appetite, integrated management of risk and return, and risk disclosure and reporting

  • New regulation. Assessing the impact, and supporting the implementation, of new regulation on business models and products

  • Risk operations excellence. Defining and applying a target operating model and organization for a risk function

  • Risk mitigation. Defining portfolio optimization and portfolio management measures; creating transparency on critical portfolio risks; and implementing  portfolio restructuring strategies

  • Risk information technology. Assessing the functionality and performance of the risk IT infrastructure, and defining a strategic risk architecture



 

SCG has been helping clients to spot, seize, and sustain advantaged positions since 1995. It remains central to our practice today across all industries and geographies. Along the way, we have pioneered a disproportionate share of the most important strategy concepts—the experience curve, portfolio strategy, time-based competition, and deconstruction, to name just a few.

 

When a SCG consultant walks through your door, he or she will be thinking about new and innovative ways for you to compete. Working in partnership with your company, we closely assess all relevant aspects of your business, design strategies to unlock new sources of advantage, and support you in bringing them to life.

 

Our capabilities also include expertise in five specific areas:

  • Vision and Mission. Identifying and defining the organization’s mission, as well as a shared vision of the future, to inform strategy and guide actions.
  • Corporate Strategy and Portfolio Management. Assessing the corporate portfolio of business units and developing strategies to maximize advantage, growth, and value creation.
  • Business Unit Strategy. Defining the path to sustainable advantage for a specific business unit.
  • Strategic Planning. Fine-tuning, supplementing, or entirely redesigning planning approaches for greater effectiveness and agility and tighter linkages with business and financial plans.
  • Future of Strategy. Applying new lenses, tools, and frameworks from the emerging frontiers of strategy to help clients enhance their advantage today. Examples include intellectual property, network analysis, and simulation.