The global financial crisis that began in 2007 begs the question: with all the progress in risk management, why were the world's leading financial service firms, their regulators, their auditors, and their rating agencies so wrong in their assessment of the inherent risks in the subprime mortgage market? These internationally recognized organizations caved in to clearly flawed conventional wisdom and accepted quantitative and qualitative models. Lured by the promise of lucrative returns, they followed their peers right off the cliff. Those who survived the crisis mitigated risk by embracing safer, more innovative risk management methods.

Providing a general overview and introduction to such proven quality-control methods as Six Sigma and Total Quality Management (TQM), which are just now finding their way into the financial sector, Risk Management in Finance: Six Sigma and Other Next-Generation Techniques provides the tools to help you sidestep financial disaster.

Focusing on the corporate management of internal processes generally classified as operational risk, Risk Management in Finance provides an examination of control tools and new techniques that are commonly used in other industries but are growing increasingly popular in the financial sector.

Here, you'll discover:

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Statistical process monitoring tools, such as Cusum charts and exponentially weighted moving averages
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New approaches to data management, predictive analytics, Bayesian process controls, and automated remediation controls
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Examples and case studies of implementations of quality financial initiatives from various industries, including Pulte Mortgage, Global Commodities, European Investment Bank, and Ameriprise Financial
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Real-world examples of Six Sigma in financial services

In today's volatile financial environment, only the leaders and innovators can survive. Increase your ability to successfully balance financial risk and reward opportunities with the groundbreaking approaches found in Risk Management in Finance.