Understanding the landscape
In October 2022, Aegon announced its intention to combine its Dutch business, Aegon NL, with a.s.r., a prominent Netherlands-based insurance group. This merger was characterized by a complex separation programme to ensure business continuity post-separation. The intricate nature of the entanglements between Aegon NL and Aegon Group posed significant operational risks, necessitating the development of a new type of risk methodology to assess the operational readiness of these entities.
The ORRA approach paves the way for an organization’s operational readiness.
The ORRA approach
The ORRA approach was developed to address the unique risks faced during the Aegon NL disentanglement, but it can be universally applied during other transformations. Unlike traditional Risk & Control Self-Assessments (RCSA), which often focus on existing processes, the ORRA is forward-looking and tailored for organizations undergoing significant change.
The approach includes a clear outline of the criteria that must be met to commence the ORRA process, ensuring that all necessary information is available for meaningful assessments. It also establishes a clear endpoint for the ORRA by detailing the required outputs and actions for completion. Finally, it features scenario analysis to evaluate interdependencies and combined risks, ensuring comprehensive risk oversight.
Transformative impact of ORRA
The ORRA approach significantly enhanced risk management by risk identification and mitigation from the outset, rather than as an afterthought. A dedicated second line workstream harmonised risk management strategies across Aegon NL and other entities involved, creating an integrated risk view. Regular reporting of ORRA outcomes to senior leadership and regulators kept all parties informed and engaged, proactively mitigating the risk of surprises during and after the transition.
Evaluating the success of the ORRA methodology
The ORRA approach demonstrated its value by providing an additional layer of assurance that key processes could operate independently post-separation. It enabled proactive identification and management of risks associated with operational readiness, facilitating a structured and transparent process that enhanced stakeholder confidence.
In conclusion, the ORRA approach serves as a robust framework for managing operational risks during significant organizational changes. By embedding risk management into the change process, it ensures that controls are designed from the outset, thereby strengthening operational resilience. The insights gained from the application of the ORRA approach not only streamline transitions but also provide a valuable blueprint for other organizations facing similar challenges, highlighting the importance of proactive measures and stakeholder engagement in achieving successful outcomes.
ORRA not only facilitates change but also empowers organizations to thrive in their new operational landscapes.
Key results
Faster risk identification.
Improved risk reduction.
Transparent communication.
