Rashida HartProfessor RothmanMarch 19, 2014Enterprise Risk ManagementVerizon Communications, Inc. In today's volatile environment, businesses must be prepared to manage portfolio risk in order to remain sustainable and viable in the current context. economy. Risks are inherent and can arise at any time. To avoid or mitigate risks, a company must have an effective Enterprise Risk Management (ERM) team or plan, led by an effective Chief Risk Officer (CRO), such as myself. As a CRO, my overall goal is to provide leadership and direction for an effective enterprise risk management framework for the organization, so that the company can increase customer churn and revenue. Verizon Communications Inc., is a Dow 3 company, with more than 180,000 employees worldwide. Verizon Communications operates in two business segments: The wireless segment, which provides voice, data and equipment and other services globally. The wireline segment makes up the other half of the business, which also provides voice, Internet access, video, data, long distance and other value-added services globally. At Verizon, we believe that identifying and prioritizing risk is an imperative practice that all businesses should adopt. We have identified six key factors and ranked them in order of highest risk. Market risk is the first risk factor that we identified as affecting the business framework. There are three types of market risk, namely trading risk, asset/liability mismatch and liquidity risk. Verizon is exposed to various market risks, including changes in interest rates, foreign currencies, fluctuations in exchange rates, changes in investments, stock and commodity prices and... . middle of paper ...... long-term cash flow . Credit risk, which is attributed to defaulted obligations of the counterparty. To reduce liability risk, we need to change our strategy to a liability-focused strategy. The second significant risk factor would be technological, since the entire network relies on updated and efficient technology to stay ahead of the competition and provide new and improved services that our customers have need. The third risk factor would be the financial risk factor, which is currently not significantly exposed to foreign currency fluctuations. When done correctly, enterprise risk management can be a transformational tool to help any organization improve its business performance. Managers and frontline employees must develop the ability to identify opportunities, obstacles, or dangers that can destroy the organization's strategic goals..