The NZDF believes the effective management of risk should be part of our organisation’s behavioural culture. This requires all personnel to be aware of risks in their day-to-day work environment and being able to identify the risks related to challenges and the pursuit of opportunities.
The Executive Leadership Team of the NZDF knows the importance of understanding risks as both threats and opportunities. By managing opportunities well, we will be in a better position to deliver military capability in support of government policies now and in the future.
The NZDF is implementing a practice for the management of risk that is improving and expanding our risk management capacity.
Risk Management Framework
The NZDF Risk Management Framework requires us to demonstrate we are actively managing risk. Our risk management framework provides personnel with the tools to take risk management activity beyond a compliance exercise.
Risk management is:
- part of all governance processes;
- integrated into the development and implementation of any business plan, policy, programme or project;
- improving the flow of risk information across the NZDF to ensure we manage risk collaboratively;
- requires risks associated with strategically important activities to be reported by management, within their area of responsibility (Strategic Objective Risk Profile); and
- is an ongoing process with the focus on continual enhancement.
Strategic Objective Risk Profile (SORP)
The Strategic Objective Risk Profile (SORP):
- identifies current and emerging risks to the successful achievement of the NZDF strategic objectives;
- prioritises the risks and provides an overview of key treatments in place or planned to address unacceptable risks; and
- recognises and explores opportunities identified through the management of strategic risk.
Strategic Objective Risk Profile Overview
Our approach includes the identification of strategic risks and associated treatments. Risks to the strategic and operational objectives of the NZDF are treated in the first instance by appropriate operational processes in response to strategic risks, and by the existing control environment in the case of operational risks. Where insufficient control is identified, appropriate treatment activities are developed and implemented.
A summary of the risk areas and treatments we have identified and will address include:
Our Stakeholders
Risk Areas:
- Political / Sovereign, and
- Partnering Risk.
Risk Treatment Includes:
- Multi-Agency Network. Developing and implementing a Multi-Agency Relationship Management Framework, and
- Participating in National and International Exercises.
Resources
Risk Areas:
- Resource Allocation Risk,
- Cash Flow Risk, and
- Capability Life Cycle Risk.
Risk Treatment Includes:
- Integrating Capital Expenditure, Operating Expenditure and Cash Flow budgeting exercises, and
- Capability Management Framework: Formalising structures and processes for the acquisition of major new and replacement military capabilities.
Enabling Processes
Risk Areas:
- Efficiency and Effectiveness Risk,
- Technology Risk, and
- Business Interruption Risk.
Risk Treatment Includes:
- Project Management Framework: Implementing a Project Management Framework that will support the achievement of strategic initiatives designed to deliver efficiencies and benefits, and
- Network-Enabled Capability: Establishing a Networked-Enabled Capability designed to ensure all NZDF capabilities effectively integrate sensors, decision makers, effectors and support capabilities.
Learning and Growth
Risk Areas:
- Personnel, Recruitment and Retention Risk;
- Personnel Capability and Capacity Risk; and
- Leadership Risk.
Risk Treatment Includes:
- Joint Services Recruiting System: Implementing a recruiting information system which brings together recruiting information supporting the Services (Navy, Army and Air Force) and NZDF requirements, and
- Professional Military Development Framework: Implementing a Professional Military Development Framework designed to increase effectiveness and efficiency of personnel development.
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