Identifying barriers to emerging strategy
16
Critical risks discovered
At a glance
Client
Company embarking on new strategy
Industry
Hospitality
Our role
Identify strategic barriers and risks
Our solution
Transform overly risk-averse culture
A new approach to mitigating risk
Scenario
Our hospitality client was seeking a risk management approach that would support its new strategy.
Approach
We conducted in-depth interviews with key executives throughout the company and examined internal controls and risk mitigation protocols.
Result
Our ERM Lite analysis found that employees overwhelmingly supported the new strategy and identified controls that could be scaled back.
Scenario
A company embarking on a new strategy and preparing for potential sale sought a new approach to its risks. The strategy was implemented to appeal to a new customer segment, and company leaders needed to know whether their key risks had shifted as a result of this change.
Grant Thornton’s ERM Lite service helped the company define its risk framework, risk categories, risk ratings and methodologies at a fraction of the cost of a full ERM process.
Importantly, the ERM Lite offering also identified barriers to the company’s strategy and techniques to remove obstacles to mitigate risk.
Approach
More than a dozen Grant Thornton subject matter specialists conducted a total of 30 in-depth interviews with key executives to discover the risks to the company’s success. After considering internal controls and risk mitigation activities, the Grant Thornton team determined that the company’s residual risks included three very high risks, 11 high risks and two moderate risks. The results — and mitigation suggestions — were shared with the C-suite, broader management functions and the full board.
Result
The assessment revealed support throughout the company for the strategy that was unusually strong for a period of substantial change. Although the employee buy-in was a huge positive, Grant Thornton also reported that certain risks such as cybersecurity would require further investment for improved mitigation. But for some other risks, less investment was necessary.
The ERM Lite service providers discovered an extremely risk-averse culture that was serving as a barrier to the strategy. Some processes required too many steps and controls that were preventing timely execution of the strategy and basic operational tasks.
Grant Thornton recommended that eliminating some internal bureaucracy and relaxing certain controls would reduce costs and time to market without meaningfully increasing risks.
Related Resources
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Shawn Stewart
Principal, Risk Advisory Services
Grant Thornton Advisors LLC
Shawn Stewart is a principal in Grant Thornton’s Risk Advisory Services practice. Based in Los Angeles, he has more than 18 years of experience and provides process design, internal audit, risk consulting, IT consulting, regulatory compliance, and M&A services to financial services clients.
Orange County, California
Industries
- Construction & real estate
- Manufacturing, Transportation & Distribution
- Technology, media & telecommunications
- Not-for-profit & higher education
- Asset management
Service Experience
- Advisory
Content disclaimer
This Grant Thornton Advisors LLC content provides information and comments on current issues and developments. It is not a comprehensive analysis of the subject matter covered. It is not, and should not be construed as, accounting, legal, tax, or professional advice provided by Grant Thornton Advisors LLC. All relevant facts and circumstances, including the pertinent authoritative literature, need to be considered to arrive at conclusions that comply with matters addressed in this content.
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For additional information on topics covered in this content, contact a Grant Thornton Advisors LLC professional.
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