Enterprise risk management (ERM) has demonstrated its value in the private sector, producing successful organizations that follow an effective process to minimize risks and achieve desired outcomes.
It should come as no surprise, then, that the federal government has taken a heightened interest in this proven practice, adapting it to public agencies in an effort to better manage risks that tend to hide in complex bureaucracies with limited interdepartmental communication. In 2014, the Office of Management and Budget (OMB) issued a revised Circular No. A-11, which, for the first time, formally introduced ERM to federal government agencies. Government officials have been hesitant to embrace it, however, because of uncertainty about ERM’s value and efficacy in the public sector, as well as concerns about implementation.