Adios To ‘3 Lines of Defense’ Risk Model

 Monday, September 28, 2020

 Insurance Thought Leadership

In this age of disruption, all those organizations that spent many years and lots of cash to dig beautiful trenches for their useless Three Lines of Defense are being seriously damaged.

These organizations are now left needing even more effort, to fill up their trenches and get out on the battlefield of real business. R.I.P., Three Lines of Defense model (the three being: operational managers; risk managers and compliance functions; and internal auditors).

Your creators saw a tiny speck of light, but millions are left without defense, and the trenches are in shambles. Sadly, your ghost will haunt many for a long time.

They still have three lines, but these are now so blurred that organizations must be extremely careful not to kill their own front-line fighters, a situation much worse than running around in the old trenches.

The model turned to a story of failed backward innovation — making something useless even more useless…… and that in the middle of the age of disruption.
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