Strategic Risk Management:
Improving Your Organization’s
Chances for Success
RIMS Conference 2012
Philadelphia
Two perspectives:
IBM
Paychex
Strategic Risk Management
Defined (RIMS)
Enterprise Risk Management (“ERM”) is a strategic business
discipline that supports the achievement of an organization’s
objectives by addressing the full spectrum of its risks and
managing the combined impact of those risks as an interrelated
risk portfolio.
Strategic Risk Management (“SRM”) is a business discipline
that drives deliberation and action regarding uncertainties and
untapped opportunities that affect an organization’s strategy and
strategy execution.
Today’s Panel
Stuart Horn
Director, Enterprise Risk Management
IBM
Armonk, New York
Stuart is Director of Enterprise Risk Management at IBM, in the role since 2008. The ERM program
has a global scope over all IBM business lines and internal operations, which reaches 170 countries,
over $100B of revenue, and 400K employees. During his 27 years at IBM, Stuart has had
experience in application development, IT services delivery, consulting, and business process
services interacting and overseeing working operations centers globally. This background provides
him the institutional knowledge to implement, align, and customize ERM for IBM's context.
Frank Fiorille
Director of Risk Management
Paychex, Inc.
Rochester, NY
Moderator
Frank is the Director of Enterprise Risk Management at Paychex, a leading provider of payroll,
human resource, and benefits outsourcing solutions for small- to medium-sized businesses. The
company has more than 100 offices and serves approximately 564,000 payroll clients and 12 million
employees nationwide. Fiorille has over 20 years experience in risk management and credit and
joined Paychex in 2002 to lead the company’s initiative to build an enterprise wide risk apparatus.
John Phelps
Director, Business Risk Solutions
Florida Blue
Jacksonville, Fl.
Company Profile
•
•
•
•
•
•
Revenue: $107B
Operating Net Income: $16.3B
Workforce: 433K
Countries: 170 Countries
Acquisitions: 130 Companies since 2000
Capital Expenditures: $50B over past 12 years
IBM’s ERM mission is about enhancing the
odds of success
Take advantage of the scale and scope of IBM’s globally
integrated enterprise to improve performance through enhanced
identification and management of enterprise risks.
IBM’s ERM Mission Statement
IBM’s ERM Mission
ERM is an approach to identify, assess and address risk in
the Formulation of the Strategy of an Enterprise
ERM is an approach to identify, assess and address risk in
the Execution of the decided Strategy of an Enterprise
ERM is an approach to identify, assess and address risk in
the Operations of an Enterprise
Doing business in new places and new ways while providing new solutions
presents new risks we may be unfamiliar with
Risk management is centered in the Business
Units, where risk is taken for commercial gain
IBM Organization At a Glance
Geographies
Business Units
Processes & Functions
HR
Opportunity
to Order
Sales & Distribution
(S&D)
Major Markets
- North America
- Europe
- Japan
Mkting &
Comms
IT
Global Technology
Services (GTS)
Order
to Cash
Set the tone to take and
manage risks across the
business for commercial gain
Finance
Sales
Incentives
Software Group
(SWG)
Legal
Growth Markets
Business Units Senior Vice Presidents
Lead and Own strategic and
operational risk management
Systems &
Technology Group
(STG)
Global Business
Services (GBS)
RESO
Sales
Ops
Supply
Chain
HW Product
Mgmt Transformation
Service Labor
Mgmt Transformation
ERM Steering Committee
ERM Executive Council
 Oversee program
 Effectiveness of risk mgmt
 Cross enterprise collaboration
ERM reports to CFO, but takes an enterprisewide view of strategic and operational risks
CEO
CFO
Strategy
General Counsel
Chief Trust &
Compliance Officer
BU CFO
CFO, S&D
Tax
General
Auditor
Chief Risk
Officer
Corporate
Development
Treasury
Controller
CFO, STG
CFO, SWG
Enterprise
Risk Mgmt
Financial
Risk Assess
Pension
Fund
Risk &
Insurance
Management
Corporate
Business
Controls
Enterprise Risk Mgmt Department (3 Headcount):
• Supports the ERM Steering Committee and Executive Councils in assisting
the business in identifying and managing enterprise level risks
• Sets standards for ERM assessment & reporting
• Integrates risk with strategy & execution
• Institutionalizes ERM knowledge
CFO, GBS
CFO, GTS
Setting the context for ERM is important and
unique to each company
Recognizing emerging risks provides
value by driving business change
Exiting Businesses
Setting Strategic Direction
Acquisitions
Operating PTI / EPS *
$13.44
Operating PTI / EPS *
Shifting market mix to enable growth
$13.44
Segment Operating PTI
Operating EPS
Segment Operating PTI
Operating EPS
 BRIC country revenue up 16%
(constant currency)
 Growth Markets are 22% of Geographic
Revenue (constant currency)
'00
'01
'02
'03
'04
'05
'06
Hardware / Financing
'00
'01
'02
'03
'04
'07
'08
'05
'06
'07
'09
'10
'11
Software
Services
'08
'09
'10
'11
* Non-GAAP: Excludes acquisition-related charges and non-operating retirement-related charges
2000 & 2001 segments not restated Hardware
for stock based
compensation; 2000-2010
Segment PTI is reclassified
to conform with 2011 operating presentatio
Software
/ Financing
Services
Sum of external segment pre-tax income not equal to IBM pre-tax income
* Non-GAAP: Excludes acquisition-related charges and non-operating retirement-related charges
2000 & 2001 segments not restated for stock based compensation; 2000-2010 Segment PTI is reclassified to conform with 2011 operating presentatio
Sum of external segment pre-tax income not equal to IBM pre-tax income
Risk Management is explicit in Board &
Executive responsibilities
Proxy Statement General Information – Board of Directors
…The Board is responsible for overseeing management in the execution of its
responsibilities and for assessing the Company's approach to risk management…
… an overall review of risk is inherent in the Board’s consideration of the
Company’s long-term strategies and in the transactions and other matters
presented to the Board...
… the Board's three committees, each of which examines various components of
enterprise risk as part of their responsibilities…
Executive Compensation Section of the IBM Proxy
…motivate our leaders to deliver a high degree of business performance without
encouraging excessive risk taking;
…emphasis on longer-term financial success and prudent risk
management…
…our compensation program and policies do not encourage excessive risk taking…
Risk is an integral part of
IBM’s Business Leadership Model
Anticipate and prepare for
Consider risk in the
formulation of strategy managing risk in execution
Integrate risk actions into
management systems
Supplement market insight with external risks,
challenge the innovation process, question
assumptions, and assess the viability execution
Marketplace assumptions, Client priorities, Technology shifts
Marketplace Insight
• External risks
• Migration of client value risks
• Competitive risks
Innovation Focus
• Identify & cover discontinuities
• New risk take-over offerings
Business Design
Alternatives
Execution
• Capabilities required to
effectively manage the
risks inherent in the
business design
Corporate strategy and growth priorities guide
the business unit strategies & execution
Strategy Cycle
Strategy cycle emphasizes risks
associated with enterprise initiatives
and achieving growth
 Consider new risks which may emerge
in the pursuit of growth strategies
 Identify other key risks that could be
obstacles to achieving unit’s objectives
 Cross-business unit interdependencies
Execution Cycle
Execution cycle emphasizes risks
associated with execution of strategy
 Risk associated with the execution of
strategies, actions to manage them, and
metrics for measuring the effectiveness
of the actions
 Provide discrete allocation of funds or
resources (as appropriate)
 Cross-business unit interdependencies
Scenario-based analysis to test and improve
flexibility and resiliency
Scenarios where the company exceeds or misses performance objectives
Consider external risk factors, business context, and unit interdependencies
Identify upside opportunities where we can help clients address the risk
Problem
Statement
• Identify Risks
• Define potential outcomes: likelihood of occurrence, timeline
and implications on the market and our business
Scenario
Modeling
• Develop scenarios based off range of outcomes
• Size business and financial implications
• Prioritize scenarios based on likelihood and size of impact
Response
• Preventative actions to manage risk
• Responsive actions should scenario materialize
• Both proactively and reactively under different conditions
Management
Actions
• Recommend next steps
• Immediate actions
• Management system to monitor, determine future action
Summary
• Inform strategy with consideration of risk
– Understand the risks the company can and should take on and how to be
appropriately compensated for taking on those risks
• Prepare to manage risk in the execution of strategies
– Identify additional actions to take to improve the chances of success
• Manage risk in ongoing operations
– Are there process changes or standards that should be set or augmented or are
there opportunities to collaborate on best practices to increase uniformity
• Provide value
– Keep line of sight to the elephants and gorillas in the room
– Enhance strategy effectiveness by engaging cross-enterprise to address
interdependencies and take advantage of scale
– Transparency of risks and effective management enables greater appetite and
tolerance in pursuit of commercial gain
Paychex Profile
• Provider of comprehensive payroll, human resource, and
benefits outsourcing solutions for small to medium sized
businesses
• Approximately 564,000 clients
• More than 100 offices nationwide
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Board & Executive Engagement
Company Strategy
“We are focused on achieving strong, long-term
financial performance by…”
“Our future results of operations are subject to a
number of risks and uncertainties. These risks and
uncertainties could cause actual results to differ
materially from historical and current results and
from our projections…”
Corporate Governance
“…lead the Board, particularly as it focuses on strategic risks and opportunities facing
the Company.”
Risk Oversight
“One of the functions of the Board is oversight of risks inherent in the operation of the
Company’s business. The Board fulfills this function through reports from officers for
oversight of particular risks within the Company, through legal review of the Company’s
strategic plan, and through delegation of certain risk oversight functions…”
Strategic Risk Management
• A comprehensive process to identify, evaluate and manage strategic risks to reduce
uncertainty AND maximize opportunities
• Guiding Principles of SRM:
–
–
–
–
–
Primary component of an organization’s ERM process
Ultimate goal is protecting and enhancing shareholder value
Effected by boards of directors, executive management and others
A strategic approach to risk and managing uncertainty is necessary to achieve company objectives
Continuous process
Related Impacts
Interdependencies
Identify
Assess
Analyze
Corporate Tolerance
Risk/Opportunity
Risk
Profile
Informed
Decisions
Align to
Corporate
Objectives
Adapt/Improve
Mitigate/Control
Monitor/Report
Frequency &
Severity
Retain/Finance
Or Transfer
Establishing Context

Setting strategy, objectives,
tone, policies, risk appetite
and accountabilities;
monitoring performance.
Identifying and
assessing risks that may
affect the ability to achieve objectives;
determining risk response strategies
and control activities.
Extended Enterprise & Value Chain

20
Operating in
accordance with objectives;
ensuring adherence to laws and
regulations, internal policies and
procedures, and stakeholder
commitments.
Strategic Risk Management Process
New Strategy & Risks
Maximizing return
on capital
Business Planning & Strategy
Long term growth
in shareholder
value
Risk
Strategy
Capital
Management,
Business
Performance
Monitoring
Economic
Capital
Allocation
Maximizing
operational cost
effectiveness
Regulatory
Capital
Calculation
Corporate
governance
Risk
Identification
&
Assessment
Risk
Framework,
Control &
Monitoring
Operational & Change Mgmt
(Systems, Processes, People)
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Projects (Objectives, Resources, Risk, Capital)
Market,
product,
customer,
operational
strategy
New
ventures,
risk/capital
impact
Optimizing volume
and profitability
Why Integrate ERM with Strategy?
“Paychex, like most firms, makes money and creates
value by taking intelligent risks and loses money or
gets in trouble by failing to manage risk effectively.”
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Paychex Strategic Process
External
Pressures
Shareholder
Expectations
Regulators
Rating Agencies
Stakeholders
Board of Directors
Internal Forces “Enabling Activities”
Information
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Risk
ERM
Process
Opportunity
Protect and Enhance Shareholder Value
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Guidance
P
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Paychex Profile
• Provider of comprehensive payroll, human resource, and
benefits outsourcing solutions for small to medium sized
businesses
• Approximately 564,000 clients
• More than 100 offices nationwide
24
Board & Executive Engagement
Company Strategy
“We are focused on achieving strong, long-term
financial performance by…”
“Our future results of operations are subject to a
number of risks and uncertainties. These risks and
uncertainties could cause actual results to differ
materially from historical and current results and
from our projections…”
Corporate Governance
“…lead the Board, particularly as it focuses on strategic risks and opportunities facing
the Company.”
Risk Oversight
“One of the functions of the Board is oversight of risks inherent in the operation of the
Company’s business. The Board fulfills this function through reports from officers for
oversight of particular risks within the Company, through legal review of the Company’s
strategic plan, and through delegation of certain risk oversight functions…”
Strategic Risk Management
• A comprehensive process to identify, evaluate and manage strategic risks to reduce
uncertainty AND maximize opportunities
• Guiding Principles of SRM:
–
–
–
–
–
Primary component of an organization’s ERM process
Ultimate goal is protecting and enhancing shareholder value
Effected by boards of directors, executive management and others
A strategic approach to risk and managing uncertainty is necessary to achieve company objectives
Continuous process
Related Impacts
Interdependencies
Identify
Assess
Analyze
Corporate Tolerance
Risk/Opportunity
Risk
Profile
Informed
Decisions
Align to
Corporate
Objectives
Adapt/Improve
Mitigate/Control
Monitor/Report
Frequency &
Severity
Retain/Finance
Or Transfer
Establishing Context

Setting strategy, objectives,
tone, policies, risk appetite
and accountabilities;
monitoring performance.
Identifying and
assessing risks that may
affect the ability to achieve objectives;
determining risk response strategies
and control activities.
Extended Enterprise & Value Chain

27
Operating in
accordance with objectives;
ensuring adherence to laws and
regulations, internal policies and
procedures, and stakeholder
commitments.
Strategic Risk Management Process
New Strategy & Risks
Maximizing return
on capital
Business Planning & Strategy
Long term growth
in shareholder
value
Risk
Strategy
Capital
Management,
Business
Performance
Monitoring
Economic
Capital
Allocation
Maximizing
operational cost
effectiveness
Regulatory
Capital
Calculation
Corporate
governance
Risk
Identification
&
Assessment
Risk
Framework,
Control &
Monitoring
Operational & Change Mgmt
(Systems, Processes, People)
10
Projects (Objectives, Resources, Risk, Capital)
Market,
product,
customer,
operational
strategy
New
ventures,
risk/capital
impact
Optimizing volume
and profitability
Why Integrate ERM with Strategy?
“Paychex, like most firms, makes money and creates
value by taking intelligent risks and loses money or
gets in trouble by failing to manage risk effectively.”
29
Paychex Strategic Process
External
Pressures
Shareholder
Expectations
Regulators
Rating Agencies
Stakeholders
Board of Directors
Internal Forces “Enabling Activities”
Information
C
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O
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S
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Risk
ERM
Process
Opportunity
Protect and Enhance Shareholder Value
E
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Guidance
P
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The Paychex ERM Framework
Paychex ERM Framework
Mission: Protect and enhance shareholder value
Infrastructure
Vision/Goals
Governance
Oversight structure
Common language
Policies
Technology
Tools
Techniques
Tolerance/appetite
Monte Carlo simulation
Integration
Process
Identify Risks &
Opportunities
Assess Risks &
Opportunities
Monitor &
Report Results
Business
goals,
objectives
and
strategies
Integrate
Results
Develop Action
Plans
Operational
processes
Strategic planning
Quality process
Competency
models
Product
development
Capital projects
Performance management
Implement
Strategy
Culture: Enabling Activities: “Become a part of the company’s DNA”
•Risk management is recognized as a key contributor to value creation.
•Equal attention is paid to both quantifiable and unquantifiable risks.
•The risk culture is defined and enshrined to give managers and employees the requisite freedom
of maneuver.
•Risk management is everyone’s responsibility and is not fragmented into compartments and silos.
•An awareness of risk and the need to manage it pervades the enterprise.
•The enterprise avoids products and businesses it does not understand.
•Scenario planning embraces uncertainty and considers all possible developments.
•Risks are identified, reported, and quantified to the greatest possible extent.
31
Environmental Scan
•Credit Default
•New or Foreign Competitors
•Shareholder Activism
Financial Risks
•Liquidity/Cash
•Interest Rate Fluctuations
•Counterparty Risk
•Revenue Management
•Currency/Foreign
Exchange
Rate Fluctuations
•Asset Valuation
•Business Acquisitions/Divestitures
•Economic Recession
•Inadequate/Inaccurate Financial Controls/Reporting
•Currency
Inconvertibility
•Adverse Changes in Environmental Regulations
•Adverse Changes in Industry Regulations
•Accounting/Tax Law Changes
•Uncompetitive Cost Structure
•Fuel Prices
•Tornados
•Directors/Officers Liability
•3rd Party Liability
•Building Subsidence/Sinkholes
•Terrorism/Sabotage
•Loss of Key Facility
•Earthquake
•Building/Equipment Fire
•Hurricane/Typhoon
•Lightning Strikes
•Volcano Eruption
•Building Collapse
•Cargo Losses
•Flooding
•Hail Damage
•Boiler/Machinery Explosion
•Geopolitical Risks
•Cargo Losses
•Severe Hot/Cold Weather
•General/Product Liability
•Animal/Insect Infestation
•Asbestos/Mold Exposure
Hazard Risks
32
•Market Share Battles
•Public Boycott or
Condemnation
•Pricing/Incentive Wars
•Technology Decisions
•Seasonality/Variability
•Ineffective Planning
•Foreign Market
Protectionism
•Customer Demand
•Program Launch
•Mergers/Industry
Consolidation
•Attacks on Brand Loyalty
•Product Market Alignment •Product Design/Engineering
•Union Relations/Labor Disagreements/Contract Frustrations
•Product Development Process •Ethics Violations
•Customer/Supplier/Dealer Relations
•Budget Overruns/Unplanned Expenses
•HR Risks – Key Skill Shortage, Personnel
•IT System Failure – Hardware/Software/LAN
•Deductible Limits
•Property Damage
•Workers Compensation
•Wildfire
•“Gotta Have Products”
Enterprise
Risks
•Land/Water/Atmospheric Pollution
•Disease/Epidemic
•Offensive Advertising
•Loss of Intellectual Property
•Timing of Business Decisions/Moves
•Equipment/Facilities
•Transaction Processing Errors
•Corporate Culture
•Inadequate Management Oversight
•Health Care/Pension Costs
•Debit/Credit Rating
Strategic Risks
•Negative Media Coverage
•Financial Markets Instability
•Tsunami
•Blizzard/Ice Storms/Wind Damage
•Heavy Rain/Thunderstorms
•Computer Virus/Denial of Service Attacks
•Extortion
•Warranty/Product Recall Campaigns
•Turnovers
•Operator Errors/Accidental Damage
•Kidnapping
•Health/Safety Violations •Theft/Embezzlement
•Loss of Key Equipment/Personnel
•Vandalism
•Accounting/Internal Controls Failures
•Information Management Problems
•Harassment/Discrimination
•Arson •Workplace Violence
•Utilities Failures –
•Gov’t Inquiries
Communications,
Electricity,
•Dealer Distribution
Water, Power
Network Failures –
Logistics Provider Failures,
Logistics Route/Mode
Disruptions
•Joint Venture/
Alliance Relations
•Perceived Quality
•Service Provider
Failures
•Restriction of
Access/ Egress
•Supplier
Business
Interruption
•Loss of Key Supplier
•Tier 1,2,3 –
Supplier Problems,
Financial Trouble,
Quality “Spills”,
Failure to
Deliver
Materials
Operational Risks
Identify & Assess Risk
Interactive Risk Assessments
Identifying the effectiveness of processes and controls via interactive participation with subject matter experts.
Step 1: Pre-work:
Step 2: Workshop
Failed
Processes
Internal
Fraud
Vendor
Failure
Failed
Systems
Human
Error
Operating Risk
• Business unit identifies risks associated with operational
errors.
•
Step 3: Mitigation
Step 4: Results
Voting technology is utilized to score/rank the risks
5 Assurance of preparedness
Impact
2
9
4
Impact
Enhance risk mitigation
7
15
3
3
Redeploy resources
6
12
8
4
5
10
1
Measure for cumulative
impact
14 13
11
2
Likelihood
• Top-ranked risks are identified and reviewed to assess
counter-measures
1
2
3
Vulnerability
4
5
• Key risks are identified and better understood creating
awareness and accountability
33
Dimensioning Risk
Inherent Risk
Residual Risk
Inherent Risk = Impact x Likelihood
Residual Risk = Inherent Risk x Uncontrolled Management Effectiveness
High
Critical
High
Under-controlled
Risk 1
Risk 1
Risk 2
Risk 2
Risk 7
Risk 3
Risk 3
Risk 4
Risk 4
Inherent Risk
Risk 8
Impact
Risk 5
Risk 6
Risk 10
Risk 9
Risk 5
Risk 6
Risk 7
Risk 8
Risk 9
Risk 10
Nominal
Over-controlled
Low
High
Low
Likelihood
High
Management Control Effectiveness
Risk Velocity
Slow
Average
Fast
Methodology – Top enterprise level risks are dimensioned using a proprietary 10 factor probability risk
scoring formula. Risk velocity is incorporated and weighted in the calculation of inherent and residual risk
to represent how quickly the onset of each risk measured translates to impact.
34
Risk Scenario Planning
“The present moment used to be the unimaginable future”
Possible - “might” happen (future knowledge)
Probable - “likely to” happen (current trends)
Plausible - “could” happen (current knowledge)
Preferable - “want to” happen (value judgements)
Ranges of Usefulness
U
Uncertainty
F
S
H
Predictability
Forecasting
Scenario Planning
Distance into the future
“Hoping”
time
Key Risks Detail
1.
Credit/ACH
2.
Risk Description
Risk of financial loss due to client defaults, dependencies on banking
partner lines of credit, NACHA rules/regulations, unsecured credit and
reliance on ACH as vehicle for collection and recovery
Regulatory Compliance
Risk Description
Maintaining compliance for all products and services with applicable
federal, state and local statutes, laws and regulations; ensuring timeliness
and accuracy of regulatory change on Paychex platforms
Primary Organization Owner(s) - Risk Management
Primary Organization Owner(s) – Risk Management
Risk Type - (K) Known
Risk Type - U1 (Unknown)
Primary Indicators
Bad debt write-offs, National Economic Indicators, ACH return
regional/industry factors, credit agency reporting CEI/DSO indicators
Primary Indicators
Regulatory activity, laws enacted, warranties/penalties, lawsuits, enforcement
activity, regulatory inquiries
activity,
Mitigation Strategies
•Branch and client transaction thresholds
•Credit bureau monitoring; consumer and commercial credit review
•Credit policies, including secured funding and security deposits
•Monitoring for credit deterioration, industry/economic data and bankruptcy
•Allowance for doubtful accounts (reserve)
•Fraud industry coalition
Mitigation Strategies
•Monitoring enforcement trends, relevant publications and industry news
•Strong regulatory agency relationships
•Active participation in Payroll Consortium
•Ongoing review and audit of compliance
•Increased training for applicable personnel
•Change management control process
Trending - Small businesses continue to hold course even though threat of a doubledip recession is starting to look more plausible. Access to credit continues to be
elusive for many struggling businesses as evident by the SBA adding “extra support”
to lenders to boost loan approvals; however, SBA-backed loans make up only a small
portion of over all business loans market. Balance sheets have improved as
businesses continue to deleverage due to caution about the future economic outlook
and legislative landscape.
Trending - Increasing pre-election pressures on the administration and Congress
around lingering economic weakness and the debt ceiling may result in ad-hoc
measures requiring compressed implementation timeframes. Debt ceiling legislation
does not include a payroll tax reduction, but a push for an extension of the current
employee payroll tax reduction through 2012. The Obama jobs proposal contains
aspects which, if enacted, could present operational and systemic challenges, with a
reduced implementation period.
Results - While soft credit risk exposure has nearly doubled over the past several
years to over $266 billion dollars, credit losses are down 82% from approximately $11
million to just $2.0 million last year.
Results - Despite the extraordinary environment of accelerated legislative changes
under the Obama administration heightened by the recent recession, Paychex has
been able to execute required changes with minimal to no adverse impact.
36
ERM Dashboards
Providing the Board and senior management with greater risk transparency
Compliance with risk policies and regulations
• Exposures vs. policy limits
• Regulatory compliance
Earnings-at-risk
• Major internal drivers
• Key external variables
Risk/return performance tracking
• Business units
• Customer segments
• Products
Real time risk reporting
• One touch visibility
• Drill down capabilities
• 24x7 escalation
• Early warning signals
Value Preservation to Value Creation
The discipline of risk
management has
evolved from strictly a
value preservation-based
focus to a balanced focus
between protecting
assets and creating or
enhancing value.
A flexible and dynamic
risk management
discipline is uniquely
positioned to quickly
adapt to change and
identify opportunistic
risk to create new
streams of revenue and
increase value
Model Risk
Risk
Management
•Target Models (3B); Lifetime Value Models
•Churn Models; Discount Engine Models
•Upsell Models; Sales Territory Models
Entrepreneurial
Risk
•$100M Revenue Over Past 5 Years
•EGTRRA Restatement
•PBS, HRO, 401(k) Service Fees
Regulatory
Compliance Risk
•Public Relations & Marketing Initiatives
•Industry Coalitions
•Client/CPA Webinars
Credit Risk
Operating
Risk
Future/White
Space
•EDI Program
•RCX Stale Date Fees
•Taxpay Premium Processing Fee
•Federal Deposit Frequency Program
•Client Penalty Abatement Service
•IRS/Paychex Partnerships
Questions?