SAP BusinessObjects Risk Management 3.0 Marko Hamel Template_SAPRiskManagement3.0_BusinessBlueprint_1.0.doc 21.12.2010
Date Name Alteration Reason Version 24.08.9999 XXX Template Finalized 1.0 Template_SAPRiskManagement3.0_BusinessBlueprint_1.0.doc page 2/29
Table of Contents 1 Overview 5 1.1 Project Objectives 5 1.2 Technical Environment 5 1.2.1 System requirements 5 1.2.2 System Landscape 5 2 Use Cases 6 2.1 Use Cases: General 6 2.2 Use Cases: Risk Data Model 6 2.3 Use Cases: Risk Input 7 2.4 Use Cases: Risk Calculation 7 2.5 Use Cases: Risk Reporting 7 3 Processes 8 3.1 Business Processes 8 3.1.1 Process 1 8 3.2 Risk Management Process 8 3.2.1 Risk Planning 8 3.2.2 Risk Identification 9 3.2.3 Risk Analysis 9 3.2.4 Risk Response 9 3.2.5 Risk Monitoring 9 4 Organization Structure 10 4.1 Risk Management Organization 10 4.2 Activity Management 10 5 Risk Data Model 11 5.1 Risk Input Form Mapping 11 5.2 Risk Calculation at <CUSTOMER> 12 6 Risk Management Workflows 14 6.1 Workflows within the <CUSTOMER> Risk Management Process 14 6.1.1 Risk Planning Workflow 14 6.2 Workflows within SAP Risk Management 15 7 Roles and Responsibilities 16 7.1 RM: Risk Operations Manager 16 7.2 AM: Accountable Manager 16 7.3 RE: Risk Expert 16 7.4 AO: Assessment Owner 16 7.5 RV: Risk Validator 17 7.6 RO: Risk Owner 17 7.7 ReO: Response Owner 17 7.8 AA: Auditor and Analyzer 17 7.9 Authorization Matrix 17 8 Authorization Concept 18 8.1 ABAP Standard Roles 18 8.2 SAP NetWeaver Portal Role 19 Template_SAPRiskManagement3.0_BusinessBlueprint_1.0.doc page 3/29
8.3 Application Roles 19 8.4 Assignment of users to Org-Units 20 9 IMG Settings 21 9.1 Maintain Entity Role Assignment (IMG: General Settings) 21 9.2 Maintain Users Responsibility for Entity (IMG: Reporting) 21 9.3 Maintain Custom Agent Determination Rules (IMG: Workflow Enabling) 21 9.4 Maintain Activity Types (IMG: Master Data Setup) 21 9.5 Risk Data Model and Calculation 22 9.5.1 Maintain Impact Levels (IMG: Master Data Setup) 22 9.5.2 Maintain Probability Levels (IMG: Risk and Opportunity Analysis) 22 9.5.3 Maintain speed of onset (IMG: Risk and Opportunity Analysis) 22 9.5.4 Maintain Probability Level Matrix (IMG: Risk and Opportunity Analysis) 23 9.5.5 Maintain Risk and Opportunity Level Colour (IMG: Risk and Opportunity Analysis) 23 9.5.6 Maintain Risk and Opportunity Level Matrix (IMG: Risk and Opportunity Analysis) 23 9.5.7 Maintain Risk and Opportunity Priorities (IMG: Risk and Opportunity Analysis) 23 9.5.8 Maintain Risk and Opportunity Priority Matrix (IMG: Risk and Opportunity Analysis) 24 9.5.9 Define Three-Point Analysis (IMG: Risk and Opportunity Analysis) 24 9.5.10 Maintain Analysis Profile (IMG: Risk and Opportunity Analysis) 24 9.5.11 Allow free text for Benefit, Impact and Driver Categories (IMG: Risk and Opportunity Attributes)24 9.5.12 Maintain Activity Types (Master Data Setup) 25 9.6 Response and Enhancement 25 9.6.1 Maintain Response and Enhancement purpose (Response and Enhancement Plan) 25 9.6.2 Maintain Response and Enhancement Plan Effectiveness (Response and Enhancement Plan) 25 9.6.3 Maintain Response Plan Types (Response and Enhancement Plan) 25 10 Appendix 26 10.1 Definitions and Abbreviations 26 10.2 References 26 11 Risk Categories 27 12 Index of Tables 29 Template_SAPRiskManagement3.0_BusinessBlueprint_1.0.doc page 4/29
1 Overview The current blueprint document helps to streamline and collect the detailed requirements of <CUSTOMER> including the specification of use cases for SAP BusinessObjects Risk Management. It is essential to gain a comprehensive understanding of processes, roles and responsibilities, organization structure, risk calculation model and risk workflows. This information is used as a source to specify and describe the customizing settings that need to be implemented to achieve the project goals. 1.1 Project Objectives The Proof-of-Concept should ensure the achievement of the following objectives: 1.2 Technical Environment Application: SAP BusinessObjects Risk Management 3.0 Add. Component 1: T-Rex Search engine (Optional) Add. Component 2: BusinessObjects Enterprise Server Add. Component 3: Adobe Interactive Forms Operating System: <xxx> Database: <xxx> 1.2.1 System requirements Solution Validation Landscape: Components Requirements (minimal) Application Component Optional Application Component Technology Component Optional Technology Component GRCFND_A 300, GRC RM Portal 300 GRC Reporting Framework 3.0 NetWeaver for ABAP 7.01 SP03 / Incl. SAP_ABA / SAP_BASIS / PI_BASIS / SAP_BW / IGS... NetWeaver for Java 7.01 SP03 / Incl. Adobe Document Services BOBJ SAP Integration Kit XI 3.1 BOE Server: BOE XI 3.1 (Fixpack 1.2) / BOBJ SAP Integration Kit XI 3.1 Productive Landscape Hardware Requirements (minimal) System Type Server Application Processor RAM HD Risk Management 3.0** Two single core processors or one dual core processor 4 GB (minimum), 8 GB (recommended) 100 GB minimum, swap space 2*RAM, 1.2 GB temporary space 1.2.2 System Landscape <to be defined.> Template_SAPRiskManagement3.0_BusinessBlueprint_1.0.doc page 5/29
2 Use Cases A detailed description of use cases will ensure a user-oriented and measurable implementation of the requirements regarding a software-based Risk Management solution. For an easier handling the use cases will be defined using the following categorization: General GEN Risk Data Model MDL Risk Input INP Risk Calculation CAL Risk Reporting REP 2.1 Use Cases: General ID Name Description GEN01 Portal Integration Integration of the Risk Management solution in a SAP NetWeaver Portal as defined UI GEN02 Role Concept All in the risk management process involved persons need to be authorized following a role based approach. GEN03 Risk Management Process The risk management process of <CUSTOMER> including the following steps need to be implemented: Risk Planning Risk Identification (incl. Risk Survey) Risk Analysis Risk Response Risk Monitoring Risk Reporting Table 1: Use Cases: General 2.2 Use Cases: Risk Data Model ID Name Description MDL01 Qualitative/Quantitative Mapping Risks are managed in qualitative as well as quantitative way. Consequently the IMG needs to be customized to support this mixed-mode using Probability (%), Impact Before and After Response (level), Total Loss ( ), Time (Priority) as input. The Expected Loss ( ) as well as the Risk Level (level) are calculated based on a defined calculation matrix. MDL02 Org.-Units Recording of risks in connection with the relevant Org.-Unit. Consequently the Org.-Unit of <CUSTOMER> is an essential part of the master data. MDL03 Risk Categories Usage of the Common Risk ID s as part of the Project Risk Register (PRR) Table 2: Use Cases: Risk Data Model Template_SAPRiskManagement3.0_BusinessBlueprint_1.0.doc page 6/29
2.3 Use Cases: Risk Input ID Name Description INP01 Risk Forms Simple input of new risks using survey-based offline-forms. The layout of the Customer Standard should be utilized. INP02 Online Input After the initial upload of the offline forms all data needs to be available for online maintenance. Table 3: Use Cases: Risk Input 2.4 Use Cases: Risk Calculation ID Name Description CAL01 Risk Calculation The current excel-based approach acts as the foundation for the calculation of risks. For more details see Risk Data Model Table 4: Use Cases: Risk Calculation 2.5 Use Cases: Risk Reporting ID Name Description REP01 PDF Printout-Report The report should show the most important attributes of an risk like: Description Driver Impact Probability Total loss Expected loss Risk level Response details REP02 Risk Dashboard / Heat Map The risk dashboard presents the most important risks based on a chosen Org. Unit aggregating the levels below. Furthermore it is important to show a heat map highlighting the distribution of risks in reference to probability and impact. Table 5: Use Cases: Risk Reporting Template_SAPRiskManagement3.0_BusinessBlueprint_1.0.doc page 7/29
3 Processes 3.1 Business Processes 3.1.1 Process 1 The output of process 1 is 3.2 Risk Management Process The <CUSTOMER> Risk Management process is based on the internal Risk Management Methodology and contains the following steps: 1. Risk Planning 2. Risk Identification 3. Risk Analysis 4. Risk Response 5. Risk Monitoring 6. Risk Reporting Risk Management Process Steps Risk Manager (RM) Risk Expert (RE) Risk Owner (RO) Response Owner (ReO) Assessment Owner (AO) 1 Accountable Manager (AM) 1. Risk Planning C R R A 2. Risk Identification C R A I 3. Risk Analysis C R A I 4. Risk Response C C R R A 5. Risk Monitoring R C R R A I 6. Risk Reporting C R R A Table 6: Risk Management Process RACI 3.2.1 Risk Planning During this step the approach how to perform risk management in each business area or project is determined. Activities: Meet with the Risk Experts on a monthly basis Discuss / Identify risk topics and areas. Plan and align risk activities and goals for risk assessments Presentation of updates Contact business owners. 1 Project Manager or delegate Template_SAPRiskManagement3.0_BusinessBlueprint_1.0.doc page 8/29
3.2.2 Risk Identification The uncovering of risks to each business area or project before they turn into problems as well as the initiation of the Risk Assessment are characteristics of this steps. Activities: Organization-/ Project-/ process interviews (risk survey) Identification of KRI s (e.g. global, strategic, operational...) Identification of relevant / corresponding KPI s Meet with business experts Setup Risk Assessments according established Processes 3.2.3 Risk Analysis The main objectives of this phase are the evaluation of risk attributes as well the prioritization of the risks. Activities: Perform the Risk Analysis in terms of: Condition, Indicator, Consequences Probability of Occurrence Impact in terms of quantity or on a qualitative scale Timeline and mitigation (response) actions which must be realized to minimize / eliminate the risk 3.2.4 Risk Response This phase closes the Risk Assessment by making the decision what should be done to mitigate handle the risks. As a final step the risks are validated by management. Activities: Clarify the questions in terms of: - Do we know enough about the risk? - Can we live with the risk? - Is it possible to do something against the risk? - Are financial and timely efforts adequate in relation to the risk? - Who is responsible to take the action? 3.2.5 Risk Monitoring Keeping track of the risks and evaluating the effectiveness of the response actions is the essential task of the monitoring. Activities: Check reporting needs in terms of: o Are the identified risks still relevant? o Is the analysis still valid? o Are there any new risks? o Are the response strategies actively taken effective? o Do we have to escalate certain risks? Template_SAPRiskManagement3.0_BusinessBlueprint_1.0.doc page 9/29
4 Organization Structure The Org-Structure will be implemented using the following hierarchy: <CUSTOMER> - Chief Executive Officer (CEO) XXX XXX XXX 4.1 Risk Management Organization The chart bellow describes the organization of the <CUSTOMER> unit from a risk management perspective: <picture> 4.2 Activity Management Since the work of the different UNIT s inside the <CUSTOMER> unit is very project-driven, the usage of so called Activities, as specific operations that may lead to actual risks in the different organization units will be implemented within the PoC environment. As a consequence an Activity Owner (represented by the Assessment Owner) is able to structure the risks within his unit based on processes, projects, initiatives or planning objects with the main advantage of having a much better and granular reporting and control possibility. The Activity Management Process contains five main steps: 1. Create an Activity (by Risk Manager) 2. Create Risks (by Assessment Owner) 3. Update Risks (by Assessment Owner and /or Risk Owner) 4. Validate the Activity (Risk Validator role) 5. Close the finished or obsolete activity Template_SAPRiskManagement3.0_BusinessBlueprint_1.0.doc page 10/29
5 Risk Data Model The <customer> defines a risk as an uncertain event or condition that, if it occurs, has a negative aspect on business or project objective. This part of the document describes how risks are collected, calculated and managed via dedicated responses. 5.1 Risk Input Form Mapping At the moment risks are collected offline using the Project Risk Register Tool (PRR) and Risk Forms (PPT). In order to use Adobe Interactive Forms in combination with SAP BusinessObjects Risk Management 3.0 the valid terms need to be mapped to the new terminology internally. Used Term Description Mapping to SAP BO RM 3.0 Title Short name of a risk. Name Common Risk ID Key attributes to classify a risk in detail. For more information see Appendix A Risk Category Organization Unit Specifies the Organization Unit a risk belongs to. Organization Unit Condition Indicator Consequence The condition describes what is actually causing the concern that certain business, financial or strategic objectives may not be achieved as planned. Root cause leads to the situation a risk is actually occurring. The consequence describes the negative impact(s) of the condition(s) on the business, financial or strategic objectives of the related business activity. Risk Description Driver Impact P% The likelihood that risk will occur in %. Probability IBR Time Total Loss Impact Before Response: The qualitative impact before risk response actions are taken The period when action is required to respond to a risk. The magnitude of the actual loss value accrued when a risk event occurs before the response actions are implemented. It is also called the quantitative financial impact. Impact Level Speed of Onset Total Loss Table 7: Risk Input Form Template_SAPRiskManagement3.0_BusinessBlueprint_1.0.doc page 11/29
5.2 Risk Calculation at <CUSTOMER> Inside SAP BusinessObjects Risk Management the probability as well as the quantitative/qualitative Impact mapping will be implemented as described in the table below. The system is able to calculate the Total Loss if the qualitative Impact Level is available and vice versa. Probability Quantitative Impact (Total Loss) Qualitative Impact 1% 19% = Remote 1 = 0 200 k 1 = Insignificant 20% 39% = Unlikely 2 = 200 k 1,000 k 2 = Minor 40% 59% = Likely 3 = 1,000 k 5,000 k 3 = Moderate 60% 79% = Highly Likely 4 = 5,000 k 25.000 k 4 = Major 80% 99% = Near Certainty 5 = > 25.000.000 EUR 5 = Catastrophic Table 8: Probability and Impact Level The RM application will use the provided data to calculate the Risk Level and the Expected Loss. PRR Term Description Mapping to SAP BO RM 3.0 P*i Expected Loss Calculates the Risk Level by multiplying Probability Level and Qualitative Impact under consideration of the Risk Level Matrix A measure of the loss associated with a risk, taking into account the Probability of the risk and the Total Loss in EUR (P*Total Loss). Risk Level Expected Loss Table 9: Risk Calculation Term The defined Risk Levels rated as High (H), Medium (M) or Low (L) depend on the assessed Probability and the Impact and will be implemented as highlighted in the Risk-Level-Matrix below. Probability at Analysis Qualitative Impact 1 2 3 4 5 Level 1: 01 19 % L L L L M Level 2: 20 39 % L L L M M Level 3: 40 59 % L L M M H Level 4: 60 79 % L M M H H Level 5: 80 99 % L M H H H Table 10: Risk Level Matrix Template_SAPRiskManagement3.0_BusinessBlueprint_1.0.doc page 12/29
After the calculation of the risk level a prioritization using the time input (Speed of Onset) needs to be determined. The risk priority is defined with a numeric value indicating the urgency, where the lowest number equals the highest priority. The defined risk priorities depend on the assessed timeframe and the Risk Level during Analysis. Timeframe Risk Level during Analysis L M H 1: Long (12 months+) 9 8 6 2: Medium (3-12 months) 7 4 3 3: Short (less than 3 m) 5 2 1 Table 11: Risk Priority Matrix Template_SAPRiskManagement3.0_BusinessBlueprint_1.0.doc page 13/29
6 Risk Management Workflows 6.1 Workflows within the <CUSTOMER> Risk Management Process 6.1.1 Risk Planning Workflow <xxx> Template_SAPRiskManagement3.0_BusinessBlueprint_1.0.doc page 14/29
6.2 Workflows within SAP Risk Management There are two kinds of workflows in Risk Management 3.0: planner-based and event-based workflows. Planner-based workflows are scheduled and triggered through the Planner, such as Update Risk or Risk Survey. They reflect the organizations Risk Management Calendar to perform regular activities like updating existing risk information or preparing for risk reportings. Event-based-workflows on the other side are predefined end-to-end processes triggered by end-user action, such as Propose Risk. In Risk Management so called Business Events are use used to map the different workflow tasks to one or several recipients. Workflow Name Description Role of Workflow Recipient Activity Survey Activity Validation Opportunity Assessment Opportunity Validation Response Update Risk Assessment Risk Survey Risk Validation Identify new risks related to an activity by sending out survey questions. Allows a planner to get sign-off and confirmation on the current risk situation for an activity (process or project). Supports Risk Managers to get an update for opportunities in their area by sending out a risk assessment work item. Allows a planner to get sign-off and confirmation on the current opportunity (analyses and assigned enhancement plans). Helps Risk Managers and Risk Owners to keep track on the current state of the risk responses by sending a work item to the Response Owner. Supports Risk Managers to get an update for risks in their area by sending out a risk assessment work item. Perform a risk survey in preparation to a planned risk re-assessment through a set of survey questions. Allows a planner to get sign-off and confirmation on the current risk (analyses and assigned responses). Assessment Owner (AO) Risk Validator (RV) (1) Assessment Owner (AO) (2) Risk Expert (RE) Risk Validator (RV) Response Owner (ReO) (1) Assessment Owner (AO) (2) Risk Expert (RE) (1) Assessment Owner (AO) (2) Risk Expert (RE) Risk Validator (RV) The Opportunity Assessment, Risk Assessment and Risk Survey will be routed to the Assessment Owner as a first step. If no Assessment Owner is responsible, because the risk was not assigned to an activity it will be sent to the Risk Expert. Template_SAPRiskManagement3.0_BusinessBlueprint_1.0.doc page 15/29
7 Roles and Responsibilities The following roles are involved in the <CUSTOMER> Risk Management Process: Risk Operations Manager (RM) Accountable Manager (AM) Risk Expert (RE) Risk Assessment Owner (AO) Risk Validate (RV) Risk Owner (RO) Response Owner (ReO) Auditor and Analyzer (AA) 7.1 RM: Risk Operations Manager The Risk Operations Manager is a senior person responsible for all risk management activities in his respective unit. He reports to the unit head. Main Tasks: Planning, coordination and aggregation of risk management activities inside the unit Aggregation of reportings Interface to Corporate Risk Management Risk Management planning for the unit Generation of risk reports (content, process compliance) on unit 7.2 AM: Accountable Manager The Accountable Manager is a manager responsible for an org unit or the delivery of a project. 7.3 RE: Risk Expert Every unit has named a Risk Expert, who supports the UnitHead in his responsibility for risk management. The Risk Expert has deep knowledge about risk management theory and the GRC Methodology. Main Tasks: Risk Management planning together with the UNIT Head and others Schedule and organizing the initial risk assessment Moderating risk assessments, including recording risk data in risk register (PPT; PRR) Driving the risk monitoring process Generating risk reports on UNIT level Support project leads and others of the UNIT in driving risk management in their area of responsibility 7.4 AO: Assessment Owner The Assessment Owner defined in the general project data has primary accountability for the project risk assessment. The Assessment Owner can change all project and risk data, including the creation of new risks. The Assessment Owner is informed of his/her role via a work item notification once the project is created. For projects the assessment owner can be the project lead or his/her delegate. Remark: Inside the unit <XXX> a neutral person, the so called Risk Assessment Moderator, might support the moderation of a Risk Assessment. Template_SAPRiskManagement3.0_BusinessBlueprint_1.0.doc page 16/29
Main Tasks: Execution of Risk and Change Management Process in the responsible area (Planning, Identification, Analysis, Response and Monitoring) Coordination and Participation of Risk Assessment Ensure aggregation of results as well as risk validation 7.5 RV: Risk Validator The Risk Validator is in charge of reviewing and approving the identified risks, the analysis, and the risk response plans as well as deciding whether the assessment should be approved, rejected, or re-worked. The Risk Validator should be at least one level higher in the management level than the Assessment Owner. Responsibility for validation cannot be delegated. Main Tasks: Sign-Off and approval of single risks or risk assessment results Rejection of risks (e.g. demand for better description, quality ) Determination of confidentiality level for risks Proposes risks for area risk reporting as well as board risk reporting 7.6 RO: Risk Owner A person identified during a risk assessment or in follow up of a risk assessment. The risk owner can be different from the project lead that has the original responsibility for all project related risks (applies equally to other tasks and entities). The role of the risk owner is to analyze risks, to initiate risk response action, and to follow-up on risk response actions. He should always be able to provide the most up to date status of the risk. Main Tasks: Description and analysis of risks Proposal of response strategies for mitigation Initiation of response actions Follow-Up of results Set or verification of "Risk and Response" status. 7.7 ReO: Response Owner A person identified during a risk assessment or in follow up of a risk assessment. The response owner s responsibility is to execute planned responses. He/she may report to the risk owner or others in that matter. Main Tasks: Execution of defined response measure Reporting of response Set of response status 7.8 AA: Auditor and Analyzer This role will be assigned to Persons needing read-only access to a complete unit. This may be the Unit Manager (if no data maintenance needed), GIAS or an external auditor. 7.9 Authorization Matrix The authorization matrix is defined in the excel sheet: Entity_Authorizations_RM30_for_<CUSTOMER>.xls. Template_SAPRiskManagement3.0_BusinessBlueprint_1.0.doc page 17/29
8 Authorization Concept The Risk Management application is based on the SAP NetWeaver authorization model and assigns authorizations to users based on roles. SAP Standard roles (PFCG basic roles) provide the technical standard authorizations to the ABAP server. Portal roles provide application content, like order and number of visible work centers, via the SAP NetWeaver Portal. The following table lists the application elements and responsible roles for authorization: Description Navigation Menu Work Set Work Center Menu Group Menu Item Access determined by Role Type Portal role Portal role Portal role Application role Application role As an additional aspect the Risk Management web-frontend (NW Portal) is used to assign end-users to business user roles and to entities 2 such as risks, opportunities and organizations based on so called application roles. These application entities are structured in a hierarchy, providing top-down authorizations. Roles and entities at a higher entity level have greater authorizations to perform tasks and greater access to the application than roles at a lower entity level. The hierarchy also affects task assignments, work flows, and business event processing. Furthermore a usage of the so called Second-Level Authorization allows a restriction of the user selection for entity-level role assignments. So only those users, who have been assigned the corresponding PFCG role in their user profile, are available for an assignment. Consequently the Second-Level Authorization provides an additional level of control. However in the PoC it was decided to de-activate this possibility and rely on the entity authorization via the web-frontend, only. 8.1 ABAP Standard Roles Risk Management provides the following basis roles: Role Name SAP_GRC_FN_BASE SAP_GRC_FN_ALL Description This is the basis backend role and is required by every user of Risk Management. This role acts as a Power User role and provides full access to all entities. 2 Table GRFNENTITY contains all available entities Template_SAPRiskManagement3.0_BusinessBlueprint_1.0.doc page 18/29
SAP_GRC_FN_DISPLAY This role provides display access to all entities and can be used for auditors. SAP_GRC_FN_BUSINESS_USER This is the standard end-user role. The access to the different entities is maintained via the web-frontend application. 8.2 SAP NetWeaver Portal Role The GRC Risk Management role provides access to the Navigation Menu for Risk Management in the SAP NetWeaver Portal as well as the following relevant Work Sets: My Home Risk Structure Risk Assessment Risk Monitoring Reporting and Analytics User Access Please note that the number and visibility of menu entries is derived from the business user role that was assigned over the frontend. Role Name pcd:portal_content/com.sap.grc.rm.enterprise_risk_management/com.sap.grc. rm.roles/com.sap.grc.rm.role_all Description GRC Risk Management 8.3 Application Roles Application roles (PFCG model roles) grant detailed authorization to the Risk Management application and refine the standard role authorizations. The following table maps the original SAP Roles to the customer specific roles in Risk Management. Role in RM 3 Example Users Role Name Original SAP Role Risk Manager (RM) Central Risk Manager Z_GRC_RM_API_RISK_MANAGER SAP_GRC_RM_API_CENTRAL_RM Risk Expert (RE) Unit Risk Manager Z_GRC_RM_API_RISK_EXPERT SAP_GRC_RM_API_RISK_MANAGER Accountable Manager (AM) Org Unit Manager Z_GRC_RM_API_ACCOUNT_MAN AGER SAP_GRC_RM_API_ORG_OWNER 3 The role name in the web-frontend will be derived from the description of the ABAP role. Template_SAPRiskManagement3.0_BusinessBlueprint_1.0.doc page 19/29
Assessment Owner (AO) Business Unit Manager/ Project Manager/ Program Manager Z_GRC_RM_API_ASSESSMNT_O WNER SAP_GRC_RM_API_ACTIVITY_OWN ER Risk Owner (RO) Risk Owner Z_GRC_RM_API_RISK_OWNER SAP_GRC_RM_API_RISK_OWNER Response Owner (ReO) Respons e Owner Z_GRC_RM_API_RESPONSE_OW NER SAP_GRC_RM_API_RESPONSE_OW NER Risk Validator (RV) CFO / Unit Head Z_GRC_RM_API_RISK_VALIDATO R SAP_GRC_RM_API_CEO_CFO Auditor & Analyzer (AA) Internal Auditor Z_GRC_RM_API_AUDITOR_ANAL YZER SAP_GRC_RM_API_INTERNAL_AUD 8.4 Assignment of users to Org-Units The assignment of the responsible persons to the different Org.-Units can be maintained in tab Risk Management -> Work Set: Risk Structure -> Menu Item: Organizations Org-Init Accountable Manager Risk Expert Template_SAPRiskManagement3.0_BusinessBlueprint_1.0.doc page 20/29
9 IMG Settings 9.1 Maintain Entity Role Assignment (IMG: General Settings) The step is used to assign the entities to individual user roles. Entity ID Role Unique 9.2 Maintain Users Responsibility for Entity (IMG: Reporting) Use this customizing activity to specify which roles are relevant for a particular entity to be used in Risk Management reporting. Entity ID Example Users 9.3 Maintain Custom Agent Determination Rules (IMG: Workflow Enabling) Specify the agent determination rules to identify the right workflow recipient for all business events to be used in Risk Management. Business Event: Is the event name for which a recipient role will be assigned. Sort: Allows prioritization and grouping of business events. Role: Assigned recipient role. Entity ID: Entity associated with the business event. Subtype: Subtype associated with the business event. (Not maintained) Business Event Name: Description for the business event. Business Event S Role Entity ID Business Event Name 9.4 Maintain Activity Types (IMG: Master Data Setup) Maintain activity types for an activity hierarchy in your organization. This enables you to group similar activity categories under one activity type in the application. Type Activity Type Name Template_SAPRiskManagement3.0_BusinessBlueprint_1.0.doc page 21/29
9.5 Risk Data Model and Calculation 9.5.1 Maintain Impact Levels (IMG: Master Data Setup) Maintain the impact levels used in risk analysis, as well as the benefit levels to be used in opportunity analysis. Imp Level Impact level Text Benefit level Text Reduction/Improvement 1 Insignificant Insignificant Very Low 2 Minor Modest Low 3 Moderate Moderate Medium 4 Major Worthwhile High 5 Catastrophic Significant Very High 9.5.2 Maintain Probability Levels (IMG: Risk and Opportunity Analysis) Configure and maintain risk probability levels for Process Control and Risk Management. Prob Level Description 1 Remote 2 Unlikely 3 Likely 4 Highly Likely 5 Near Certainty 9.5.3 Maintain speed of onset (IMG: Risk and Opportunity Analysis) The speed of onset refers to the time horizon in which you expect the risk to occur. In this way, you can specify values for the periods in which action is required to respond to a risk. Speed of Onset Description 1 Long (12 months +) 2 Medium (3-12 months) 3 Short (less than 3 months) Template_SAPRiskManagement3.0_BusinessBlueprint_1.0.doc page 22/29
9.5.4 Maintain Probability Level Matrix (IMG: Risk and Opportunity Analysis) Configure and maintain risk probability levels for Process Control and Risk Management. Prob Value From Prob Level 1 1 30 2 50 3 70 4 90 5 9.5.5 Maintain Risk and Opportunity Level Colour (IMG: Risk and Opportunity Analysis) Maintain risk and opportunity levels, together with the colors for the various risk or opportunity levels. These are used in the front-end application when working with risk scenarios or carrying out a risk analysis. Level Description Position Risk Level Color Opportunity Level Color H High 1 Red Red L Low 3 Green Green M Medium 2 Yellow Yellow 9.5.6 Maintain Risk and Opportunity Level Matrix (IMG: Risk and Opportunity Analysis) A risk level refers to the level of severity for a risk and corresponds to a defined risk level value. The combination of impact level x probability level should correspond to the defined risk level. Probability Impact Level Level 9.5.7 Maintain Risk and Opportunity Priorities (IMG: Risk and Opportunity Analysis) Maintain numerical values for risk and opportunity priorities. Risk Priority Description Template_SAPRiskManagement3.0_BusinessBlueprint_1.0.doc page 23/29
9.5.8 Maintain Risk and Opportunity Priority Matrix (IMG: Risk and Opportunity Analysis) Specify the values for the speed of onset, the calculated risk level and the risk priorities. Speed of Onset Level Risk Priority 9.5.9 Define Three-Point Analysis (IMG: Risk and Opportunity Analysis) The "three points" to be defined and then analyzed are the minimum loss, the average loss, and the maximum loss, which you define in percentage format. Usage: (Minimum + Maximum + 4(Average))/6 Date Min Loss Avg Loss Max Loss Active 21.07.2009 16,6667 66,6666 16,6667 X 9.5.10 Maintain Analysis Profile (IMG: Risk and Opportunity Analysis) The following analysis profile options are available in this Customizing activity: Impact Reduction: This refers to the reduction in the impact of a risk after risk response. If you do not set the indicator, the impact reduction section does not appear on the Response tab of the RM UI. Probability: Quantitative: In this option, the probability appears as in input field on the UI and you can enter the probability percentage value. Speed of Onset: Switch on the timeframe as the period of time that is available to decide on the risk responses. Impact Value: Mixed: In this option, both qualitative and quantitative options appear on the UI. Profile ID Impact Reduction Probability Speed of Onset Impact Value Aggregation Method Active 0000000001 X Quantitative X Mixed Average X Customized: Probability = quantitative and impact value = quantitative result The system converts the probability percentage value into a probability level. In addition, the system calculates the impact level on the basis of minimum, average, and maximum impact amounts, after which the system calculates the risk level. 9.5.11 Allow free text for Benefit, Impact and Driver Categories (IMG: Risk and Opportunity Attributes) After a certain category was activated the field for entering the corresponding text is enabled and you can enter text describing the object. Template_SAPRiskManagement3.0_BusinessBlueprint_1.0.doc page 24/29
Category Application Active 9.5.12 Maintain Activity Types (Master Data Setup) Maintain activity types for an activity hierarchy in this organization. This enables you to group similar activity categories under one activity type in the application. Type Activity Type Name 9.6 Response and Enhancement Enhancements are not in scope. 9.6.1 Maintain Response and Enhancement purpose (Response and Enhancement Plan) Maintain the specific purposes of responses to risks or enhancement plans for opportunities. Response Response Purpose Text 9.6.2 Maintain Response and Enhancement Plan Effectiveness (Response and Enhancement Plan) Define levels for the effectiveness of responses to risks, as well as the effectiveness of the enhancement plan for an opportunity. Eff. Level RespEff. % Effectiveness desc. 0 50 Ineffective 1 75 Partly Effective 2 100 Effective 9.6.3 Maintain Response Plan Types (Response and Enhancement Plan) Configure and maintain specific response types for the risks defined. Type Description Template_SAPRiskManagement3.0_BusinessBlueprint_1.0.doc page 25/29
10 Appendix 10.1 Definitions and Abbreviations Term GRC Description Governance, Risk and Compliance 10.2 References <CUSTOMER> Organization Structure Template_SAPRiskManagement3.0_BusinessBlueprint_1.0.doc page 26/29
11 Risk Categories ID Common Risk Focus Area Country Risk Report Financial Risks Financial Reporting Accounting Guidelines Financial Market Regulations Financial Misstatements Internal Compliance Financial Financial Financial Financial Treasury Currency Liquidity Cost of Financing Investment / Debt Derivative Instruments Cash Management Financial Financial Financial Financial Financial Financial Controlling Budgeting Financial Planning and Forecasting Cost Center Reporting Financial Financial Financial Organization and Governance Corporate Governance Organizational Structure Processes Process Execution Internal Controls System Org. & Gov. Org. & Gov. Org. & Gov. Org. & Gov. Org. & Gov. Operational Risks Intellectual Property Rights Template_SAPRiskManagement3.0_BusinessBlueprint_1.0.doc page 27/29
Procurement Vendor Selection Vendor Monitoring Vendor Dependency Policy Infrastructure Operations Security Governance Facilities and Physical Security Planning and Construction Loss of Infrastructure Unauthorized Access Impairment of Personnel Facilities and Physical Security Information and IT Confidentiality Availability Technology Integrity Information & IT Template_SAPRiskManagement3.0_BusinessBlueprint_1.0.doc page 28/29
12 Index of Tables Table 1: Use Cases: General... 6 Table 2: Use Cases: Risk Data Model... 6 Table 3: Use Cases: Risk Input... 7 Table 4: Use Cases: Risk Calculation... 7 Table 5: Use Cases: Risk Reporting... 7 Table 6: Risk Management Process RACI... 8 Table 7: Risk Input Form... 11 Table 8: Probability and Impact Level... 12 Table 9: Risk Calculation Term... 12 Table 10: Risk Level Matrix... 12 Table 11: Risk Priority Matrix... 13 Template_SAPRiskManagement3.0_BusinessBlueprint_1.0.doc page 29/29