CISM · Question #861
Which of the following is the MOST important factor in an organization's selection of a key risk indicator (KRU)?
The correct answer is A. Target audience. The target audience is the most important factor because a KRI only has value if it is meaningful, understandable, and actionable to the people who will consume it. Different audiences-board members, C-suite executives, or operational managers-require KRIs at different levels…
Question
Which of the following is the MOST important factor in an organization's selection of a key risk indicator (KRU)?
Options
- ATarget audience
- BReturn on investment (ROI)
- CBusiness impact
- DCompliance requirements
How the community answered
(33 responses)- A85% (28)
- B9% (3)
- C3% (1)
- D3% (1)
Explanation
The target audience is the most important factor because a KRI only has value if it is meaningful, understandable, and actionable to the people who will consume it. Different audiences-board members, C-suite executives, or operational managers-require KRIs at different levels of abstraction and with different thresholds. A technically perfect KRI that the audience cannot interpret or act upon provides no risk management value. Business impact, ROI, and compliance requirements are secondary considerations that matter only after the indicator is appropriately designed for its intended consumers.
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