Laying the Foundation of a Sector Wide Risk Model for the Telecommunications Industry

Abstract

For executive management to guide an enterprise, forward planning is essential. Using enterprise wide risk management (EWRM) as an input to scenario analysis (SA) for strategic planning (SP) allows for improved accuracy over conventional methods. This would allow for greater realism from the executive management perspective of possible outcomes in scenario modelling by providing a solid quantitative base founded on real operational information. The core of any telecommunications enterprise is the operational support systems (OSS) that provides the hardware, software and system's infrastructure to operate the enterprise. The smooth operation and efficient handling of any unforeseen events in the OSS impacts the very survival of the enterprise, thus the development of an OSS risk management (RM) strategy to provide an efficient and effective way to recognise, classify and mitigate the risks involved in OSS is crucial to any enterprise that seeks to remain competitive. To implement this RM strategy and provide information regarding likely loss events, a quantitative risk model is required to simulate different scenarios. One such event is the entry of a new telecommunications enterprise into the market and this research investigates the development of a sector wide risk model (SWRM) to simulate such an event.