Risk management Web portal eRisks.com is expanding beyond its origins as an information and analytical services site and into the service-bureau and value-added broker arena. The site was launched in October and is part of Enterprise Risk Solutions, a subsidiary of Oliver Wyman & Co., which offers management consulting services as well as the eRisks site for enterprise-wide risk management. With the additional services and features of the site, eRisks.com is aiming to be a one-stop shop for risk professionals.
Were developing a service bureau which will provide applications for risk management through the Internet, says James Lam, founder and president of Enterprise Risk Solutions. We want to provide apps on tap, where people can rent software applications such as economic capital, risk adjusted return on capital (RAROC), value at risk and credit risk from either Oliver Wyman or other software vendors. Lam says that through outsourcing risk analytics and reporting, eRisks.com would provide a more efficient alternative to purchasing or building internal applications.
Its more cost effective because they need an infrastructure, IT staff and risk management staff to run and build their own applications, explains Lam. Secondly, one of the things that risk management is concerned with is selecting the right models and selecting the right assumptions. With an Application Service Provider (ASP), you have a selection of risk software so you can run your portfolio through different models and different assumptions.
The brokerage services will be introduced concurrently with the service bureau initiative with both expected to be operational by the second quarter. We want to help our clients articulate their risk profile and appetite through our service bureau and our consulting services. Then we can help them structure and transact a transfer strategy, says Lam. He describes the brokerage as offering risk transfer product providers such as derivatives and insurance products, or hedging to reduce risk exposure.
Theres a lot of value in integrating these different levels of services. Now a client doesnt have to go to one site for news and data and another to analyze their portfolio and yet another to get early warning indications, then call their broker or go to another site to transact, says Lam. We want to establish a common infrastructure, a common methodology to meet all of a clients risk management objectives.
Traffic to the site has been growing steadily, with 3,800 registered users at the end of 1999, and a target of 10,000 by the end of 2000, says Lam. Access to eRisks.com is currently free to users, but when the service bureau and brokerage options are rolled out a fee structure for premium services will be adopted.