An Overview of Risk Management Framework (RMF)

The risk management framework is a six-step process created to engineer the best possible data security processes for institutions. The ... ITServiceManagement ProjectManagement AgileMethodology QualityManagement ITSecurityGovernance DevOps More ProfessionalDevelopment TopTens Search WEBINARS INFOARTICLES Signin Welcome!Logintoyouraccount yourusername yourpassword Forgotyourpassword?Gethelp PrivacyPolicy Passwordrecovery Recoveryourpassword youremail Apasswordwillbee-mailedtoyou. InvensisLearningBlog Advertisement ITServiceManagement ProjectManagement AgileMethodology QualityManagement ITSecurityGovernance DevOps More ProfessionalDevelopment TopTens HomeITSecurityandGovernanceAnOverviewofRiskManagementFramework(RMF) ITSecurityandGovernance Variousinstitutionsacrossindustrieshaverealizedtheimportanceofmanagingorganizationalrisk.Itisconsideredtobeaveryimportantelementinthecompany’ssecuritysystem.69%ofexecutivesarestillnotsureoftheirexistingriskmanagementpoliciesandpractices.Theydonotknowifthepoliciestheyhaveinplacewillbeenoughtomeetfutureneedsinmitigatingrisk. Ariskmanagementframeworkcreatesaneffectivemeanstohelpcompaniesselecttherequiredsecuritycontrolswhicharedeemednecessarytoprotecttheorganization,itsteammembers,aswellasalloperationsandassetsoftheorganization. WhatisRiskManagementFramework? Theriskmanagementframeworkisasix-stepprocesscreatedtoengineerthebestpossibledatasecurityprocessesforinstitutions.Theframeworkalsohelpsinformulatingthebestpracticesandproceduresforthecompanyforriskmanagement. Theframeworkisdesignedtoaccessallthelayersoftheorganization,understandthegoalsofeachproject,andmonitoralloperatingsystemstoidentifyandanalyzeanypossiblerisks.Itisintegratedwithsoftwareintheorganization.Ariskmanagementframeworkisusedtoprovidekeysecurityinformationtobusinessessotheycancreatesuccessfulriskmanagementandmitigationstrategies. Theprocessinvolvessixstepssothatcompaniescancompletealltheprojectstheyundertakeinasecure,compliant,andcost-effectivemannerthroughouttheirlifespan.Itisacost-savingmeasureaswellbecauseriskmanagementplatformsusethedatatheyhavecollectedfrompastprojectstocreatepredictionsandfutureanalysesfortheirprojects.Theseinsightsareextremelyvaluablebecausetheyhelpinavoidingrisksandputtingriskmitigationprocessesbeforehand. The6RiskManagementFramework(RMF)Steps RiskManagementFramework(RMF) Steps Herearethesixstepsinvolvedincreatingariskmanagementframework. Step1:CategorizationofInformationSystem  Beforecreatingaframework,theITsystemgetsassignedasecurityrole.Thisiscreatedbasedontheproject’smissionaswellasthebusinessobjectivesitaimstoachieve.Thisrolehastobeconsistentwiththeorganization’sexistingriskmanagementstrategy. Thisstepcreatesafoundationfortheframeworkanditsdocumentationofallprocessesaswellasitssecurityplan.Theriskmanagementsystemhastofirstcategorizetheinformationsystemaswellasdocumenttheresultsfromitscategorization. Afterthisisdone,oneneedstoputallthespecificdetailsinthesystemsuchasthesystemboundary.Organizationsalsocreateanidentificationofthesystem’ssecurityprofessionals.Administrativedetailsaswellasothertechnicaldetailsarethenadded. Thethirdaspectofthisstepistomakesurethattheriskmanagementframeworkisimplementedacrossallthenecessarydepartmentsintheoffice.Thisisusuallydonewithaprogrammanagementofficetohelpinmonitoringallorganizationalsystems. Step2:SelectionofSecurityControls  62%oforganizationshaveexperiencedwhatcanbecategorizedasacriticalriskeventinthepastthreeyears,accordingtoastudydonein2018.Thismeansthatsecuritycontrolsforanyorganizationhavebecomemoreimportantthanever. Anysecuritycontrolsthatareundertakenforaprojectortheoverallhealthoftheorganizationneedtobeapproved.Thesecontrolsareselectedbyemployeesintheuppermanagementanddevelopmentdepartments.Thecommoncontrolsalsohaveadditionalhybridcontrolsandsystem-specificcontrolsinplacetoimproveperformance.  Thesesecuritycontrolsareallthehardware,software,andtechnicalprocessesthatareconsiderednecessarytofulfillthebasiccompliancerequirementsintheproject.Theseassurancerequirementsarealsoapartoftheriskassessmentstrategy.Thecontrolsneedtobemonitoredregularlyandthemeanstodososhouldbeundertakeninthisstep. Step3:ImplementationofSecurityControls  Thisstepinvolvesimplementingthesecuritycontrolsthathavebeenselectedinthepreviousstep.Oncethesecontrolshavebeenputtouse,theyneedtobemonitoredtounderstandwhetherornottheyhaveachievedtheminimumassuranceandcompliancerequirementsthatwereset.  Thisstepselectsalltherightwaysinwhichtheinformationsystemisbeingusedalongwithallthemethodologiesofsecurityengineering.Implementingtherightsecuritycontrolsfortheorganizationisnecessarytomitigateriskappropriately. Theorganizationswhichexperiencedthecriticalriskeventsawthatthebiggestandthemostsignificantconsequencestheyhadtodealwith(risksthatproducedlargeorsevereimpact)wereinthefollowingcategories: Employeeproductivitywasaffectedby62% Operationalefficiencysuchasdisruptioninsystemsandprocessesandsoonwasat59% Employeesafetywasaffectedby29% Competitivedifferentiationwasreducedby29% Thebrandandreputationoftheorganizationswerehitbyanaverageof28% Thisiswhythesuccessfulimplementationofariskmanagementframeworkisnecessary.Ithelpsmaintaintheoverallhealthoftheorganization,upholdsemployeesafety,andthebrandreputationtothepublic. Step4:AssessmentofSecurityControls  Onceallthesecuritycontrolsareinplaceandtheassuranceandcompliancerequirementshavebeenmet,anindependentassessorisinvitedtotheorganizationtoreviewandapprovethesecontrols.  Thereviewerwilltrytofindanydiscrepanciesinthesecuritycontrols.Incaseanyweaknessesordeficienciesarefound,theorganizationwillremedytheerrorsandthencontinuetodocumentthesecurityplanaccordingly. Step5:AuthorizationofInformationSystem Afteralltheassessmentprocesseshavebeencompleted,theorganizationneedstopresentapackageforauthorizationthatwilltakecareofalltheriskassessmentsandriskdeterminationforthebusiness.Thepersoninchargeofthisprocesswillsubmittheauthorizationdecisiontoallrequiredstakeholders. Step6:MonitoringAllSecurityControls Thefinalstepintheprocessofcreatingariskmanagementframeworkiscontinuous.Theorganizationneedstomonitorallthesecuritycontrolsregularlyandefficiently.Theyalsoneedtokeepalltheupdatesinmindbasedonanychangestothesystemortheenvironment. Thesecuritystatusoftheriskmanagementframeworkneedstobeupdatedregularlyaswell.Thereportsaremadeandsentoutperiodicallytofindoutifanyweaknessesneedtobetakencareof. ChecklistForCreatingaRobustRiskManagementFramework  Thegivenchecklistcanbeusedasastep-by-stepguidethatcomeswithcreatinganeffectiveriskmanagementprogram.Theseareasshouldbeconsideredapriority. Effectiveriskmanagementgovernance Theboardmembersareresponsibleforthematerialimpactofanyrisk,regardlessofwhereitiscaused.Thisiswhyallemployeesandtheboardmembersneedtomonitorhoweffectivethecompany’sriskmanagementprocessis.Theyneedtodosotoensurethatitisimplementedacrossalllevelsanddepartmentsofthecompany. Internalauditorsareusedtoconfirmingthattheboardhasfullknowledgeofthematerialriskstothecompany.Theserisksalsoneedtobedisclosedtoshareholderswithproofthattheyarebeingmitigated. Performancemanagementandgoalmanagement Hereteamleadersneedtodividedifferentcorporateobjectivesandimplementthemintounitcontributions.Afterthisisdone,theyneedtoidentifythedifferentprocessesusedforachievingbusinessgoalsineachdepartmentorproject.Thesegoalsneedtobemadevisibletomanagersthatareinvolvedintheseprocesses.Oncethisisdonethereneedstobealinkformbetweenallthecontributingprocessesandthegoals. Consistentriskidentificationandprioritization Thenextstepisassessingrisks.Theseassessmentsneedtoaddressmorethanjusthigh-impactrisks.Alleffectiveassessmentsdelveintodifferenteventsofrisktodiscovertheirrootcause.Todothiseffectively,theassessmentsneedtoberegularlyconductedandbasedoncommonnumericalscalesacrossdifferentdepartments. Actionablerisktolerances Companiesneedtounderstandtheirriskappetitethentakestepsforcreatingactionablerisktolerance.Thiscanhelpwithcreatingaguideformakingstrategicdecisionstomanagerisks.Risktoleranceactsasatechniquetomonitorperformancegoalsandotherriskmetrics. Centralizedriskmonitoringandcontrolactivities Justcreatingprocessestoidentifyrisksandthenmakingappropriateresponsesforthemisnotenough.Animportantstepthatriskmanagersoftenmissismonitoring.Thisisusedtogaugetheeffectivenessofthecontrolsplacedonmitigatingrisks.Todososuccessfully,thefollowingneedstobeconsidered: Spendlesstimeonrisksthatarelosingtheirimpactbyregularlyadjustingriskassessments  Identifyareaswherecontrolscanbesharedtoincreaseorganizationalefficiencyandreducetesting Prioritizerisksandactivitiesbasedonprocessesthatshouldbemonitored Regularlymonitorvariousbusinessmetricsbylookingfornewandconcerningtrendsthatcouldhaveanimpactontheorganization Forward-lookingriskandgoalreportingandcommunication Boardswillneedsufficientevidenceofthepositiveinfluenceoftheriskmanagementprogramtocontinueputtingresourcesintoitforthecompany.Riskmanagersshouldhaveananswertohowmanyriskswereidentifiedwhichcanbeconcerningtothebusinessobjectivesanddifferenttrendsthatwerespottedthatvalidatetheeffectivenessofaprogram. LeadershipCommitmentToBuildingRisk-ManagementCulture Ariskmanagementframeworkwillonlyworksuccessfullyifitisintegratedintotheorganization’sculture,whichcanonlystartfromthetop.Theriskmanagementframeworkneedstobedesignedandfilteredthroughalldepartmentsandalllevelsoftheorganization.Businessleadersneedtostepintomakethishappenfortheircompany.  Teamleadersandbusinessleadersneedtoworktogethertoaligntheirbusinessobjectiveswithdifferentriskmanagementinitiativesinthecompany.Resourcesneedtobeadequatelyallocatedsothattheriskmanagementstrategycanbeproperlyimplemented,monitored,andimprovedovertime. CreatingAnUnderstandingOfHowRiskManagementFitsWithinAnOrganization Riskmanagementpracticeswillgoonduringthecompany’slifetimeacrossalldepartments.Alotoforganizationsimplementriskmanagementactivitieswithoutcreatingastructuredframeworktosupportandimproveit,whichisnotgoodforthehealthofthecompany.  Riskmanagementprocessesneedtobeusedtopromotebetterdecision-makingacrossthecompanyandalsoidentifyandaddressalltheriskstothecompanybycreatingplanstosupportthesame.Aframeworkactslikeaprocessthatisputinplacetodriveactionandsupportsspreadinginformationaboutriskstoallpartsoftheorganization. Ariskmanagementframeworkisengagingandprovidesthechancefororganizationstoforecastandpreventanycriticaleventsinthefuture.Thebestriskmanagementstrategycomeswithaframeworkthatfitsperfectlywithacompany’sorganizationalinfrastructureandimplementsitselfseamlessly. BuildinganOrganizationalInfrastructurethatsupportsRiskManagementInitiatives Varyingorganizationalrolesandresponsibilitiesneedtobeestablishedforasuccessfulriskmanagementprocess.Theresponsibilityfordecision-makingneedstobeassignedandresourcesneedtobeallocatedtosupportthedifferentriskmanagementinitiativesofthecompany.  Onceallresponsibilitiesareclearlydefined,companiescanshifttheirfocusoncreatingaconsistentprocessacrosstheorganization.Riskmanagementstrategiesshouldalsoinclude enterprise-widetrainingprograms andvariouscross-functionalriskmanagementteams.Wheneveritisnecessary,organizationsshouldalsocalldifferentriskmanagementexpertstoevaluatetheprocessesandmakethemmoreeffective. Conclusion Organizationshavecometorealizethatenterpriseriskmanagementisanongoinganditerativeprocess.Developingandimplementingastrategyjustonceisnotenoughanymore.Theriskstoanycompanycontinuetoevolvebasedonmanychangesintechnology,thephysicalandeconomicclimate,andmore.Thisiswhycompaniesalwaysneedtobepreparedtohandleanyrisksthatmaycome.  Thethreeriskmanagementframeworksarethemostwidelyusedonesbycompaniesacrosstheworld.Toimplementthesestrategies,monitorthem,andimproveuponthemregularlyrequiressomeamountofexpertise.ThisiswhytherearemanyIT Securitycertificationcoursesandtrainingprogramsavailablesothatemployeesatanyorganizationcanbetrainedappropriatelytounderstandandmanagetheriskstotheircompany. COBIT5Assessor CRISC COBIT5Foundation COBIT5Implementation CGEIT RELATEDARTICLESMOREFROMAUTHOR TheEvolutionofCOBIT2019fromCOBIT5 CybersecurityFrameworkTutorial COBIT5FrameworkTutorial LEAVEAREPLYCancelreply Pleaseenteryourcomment! Pleaseenteryournamehere Youhaveenteredanincorrectemailaddress! 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