The Role of Risk Management in Achieving Branch Office KPIs in Bank X
Abstract
This study aims to analyze the role of risk management in achieving Key Performance Indicators (KPI) at Bank X branches. A qualitative approach with a case study method was used, with data collection through questionnaires, in-depth interviews, and document analysis. The results of the study indicate that although risk policies have been designed in an integrated manner at the head office level, their implementation at the branch level faces challenges in the form of inequality in understanding risk, limited human resources and technology that is not yet optimal. Meanwhile, budget and communication have been running well. The risk management paradigm is often seen as a compliance tool rather than a proactive strategy to support the achievement of organizational targets. This study recommends the development of risk-based KPI indicators to create a more holistic and fair performance evaluation, strengthen the relationship between risk strategy and organizational performance, and build a more risk-aware organizational culture.
Keywords: Risk Management; Key Performance Indicators (KPI); Banking; Performance Evaluation
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References
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Susanto, A. (2018). The importance of risk management in an organizations. International Journal of Scientific and Technology Research, 7(11), 103–107. https://www.scopus.com/inward/record.uri?eid=2-s2.0-85059864548&partnerID=40&md5=6bddc8f6bfccca2debedd15a598b595e
Velez, S. B. (2022). Operational risk management in banks and idiosyncratic loss theory: A leadership perspective. Emerald Publishing Limited.
Young, J. (2008). Roles and responsibilities for managing operational risk in a banking environment. Corporate Ownership & Control, 5(3).
Young, P. C., Jondle, D. J., Maines, T. D., & Rovang, M. D. (2015). Risk management and ethical cultures. In The Routledge Companion to Strategic Risk Management (pp. 57–69). https://doi.org/10.4324/9781315780931-12
Yousef, A. N. B., Taha, R., Muhmad, S. N., & Abidin, A. F. Z. (2023). Operational Risk and Financial Performance of Banks in The Middle East and North Africa. Journal of International Studies(Malaysia), 19(2), 93–118. https://doi.org/10.32890/jis2023.19.2.4
Almasarweh, M. S., Alhassan, H. L., Mustafa, S. M. B., Al-Hamad, A. A.-S. A., Nawasra, M., Ahmad, A. Y. A. B., & Alsmadi, L. A. (2024). Performance measurement: Key performance indicators as drivers in assessing risk and improving value in the services sector. Journal of Project Management (Canada), 9(4), 403–420. https://doi.org/10.5267/j.jpm.2024.7.006
Bank X. (2024a). Annual Report Bank X 2023.
Bank X. (2024b). Key Performance Indicators Kantor Cabang Tahun 2023.
Cernisevs, O, Popova, Y., & Cernisevs, D. (2023). Risk-Based Approach for Selecting Company Key Performance Indicator in an Example of Financial Services. Informatics, 10(2). https://doi.org/10.3390/informatics10020054
Cernisevs, Olegs, Popova, Y., & Cernisevs, D. (2023). Business KPIs Based on Compliance Risk Estimation. Journal of Tourism and Services, 14(27), 222–248.
Committee of Sponsoring Organizations of the Treadway Commission. (2017). Enterprise risk management: Integrating with strategy and performance.
Derradji, R., & Hamzi, R. (2024). The convergence of process-risk management and decision-making: an integrated vision. International Journal of Business Continuity and Risk Management, 14(3), 305–326. https://doi.org/10.1504/IJBCRM.2024.141606
Graham, J. (2017). People Risk Management in the Digital Age. In The Cyber Risk Handbook: Creating and Measuring Effective Cybersecurity Capabilities (pp. 347–358). https://doi.org/10.1002/9781119309741.ch24
Hoa, P. T. P., & Thoa, N. B. (2014). A case study of employees’ performance at prime group Vietnam. Vision 2020: Sustainable Growth, Economic Development, and Global Competitiveness - Proceedings of the 23rd International Business Information Management Association Conference, IBIMA 2014, 1, 3208–3245. https://www.scopus.com/inward/record.uri?eid=2-s2.0-84906272357&partnerID=40&md5=d7ed0cecfbf78503914bb9d09d9210fb
Hollender, M., Chioua, M., Schlake, J., Merkert, L., & Petersen, H. (2016). KPI-based process operation: Management of highly automated processes. GWF, Wasser - Abwasser, 157(9), 52–61. https://www.scopus.com/inward/record.uri?eid=2-s2.0-84989339575&partnerID=40&md5=f3b27cb21419ddd83466bb5749448a9d
Huang, Y., & Shen, T. (2023). Risk Assessment Model of Accounting Resource Sharing Management Based on Genetic Algorithm. Lecture Notes in Electrical Engineering, 1045 LNEE, 436–443. https://doi.org/10.1007/978-981-99-2287-1_62
Md Ariff, M. S., Zakuan, N., Som, N. M., Tajudin, M. N. M., & Mat Saman, M. Z. (2017). The effect of risk management practices on research university performance. Man in India, 97(17), 289–298. https://www.scopus.com/inward/record.uri?eid=2-s2.0-85031803395&partnerID=40&md5=a99933ee52be301ef6d7669b56d51a65
Otoritas Jasa Keuangan. (2016). Peraturan Otoritas Jasa Keuangan Nomor 18/POJK.03/2016 tentang Penerapan Manajemen Risiko Bagi Bank Umum. https://www.ojk.go.id/id/kanal/perbankan/regulasi/peraturan-ojk/Documents/Pages/POJK-Nomor-18.POJK.03.2016/SAL - POJK Manajemen Risiko .pdf
Priya, P. K., Rudra, K., Kandula, D. S., Teja, G. C., & Venkata Koushik Reddy, K. (2023). An innovative analysis of AI-powered automation techniques for business management. In Toward Artificial General Intelligence: Deep Learning, Neural Networks, Generative AI (pp. 269–286). https://doi.org/10.1515/9783111323749-013
Radomska, J. (2018). The relationship between operational risk level and strategy implementation effectiveness. Proceedings of the 31st International Business Information Management Association Conference, IBIMA 2018: Innovation Management and Education Excellence through Vision 2020, 724–735. https://www.scopus.com/inward/record.uri?eid=2-s2.0-85060801019&partnerID=40&md5=d5fec98a6958d0aac7dd85fee9833c6f
Rahim, N. F. A., Jaafar, A. R., Syamsuddin, J., & Sarkawi, M. N. (2017). Internal control system and hazard identification of operational risk in Malaysian conventional banking. International Journal of Supply Chain Management.
Rana, T., Wickramasinghe, D., & Bracci, E. (2019). New development: Integrating risk management in management control systems—lessons for public sector managers. Public Money and Management, 39(2), 148–151. https://doi.org/10.1080/09540962.2019.1580921
Rasid, S. Z. A., Golshan, N., Mokhber, M., Tan, G.-G., & Mohd-Zamil, N. A. (2017). Enterprise risk management, performance measurement systems and organizational performance in Malaysian public listed firms. International Journal of Business and Society, 18(2), 311–328. https://www.scopus.com/inward/record.uri?eid=2-s2.0-85036503152&partnerID=40&md5=a1691e13b45ad80965d27a61f8c2d975
Ruiz-Canela López, J. (2021). How Can Enterprise Risk Management Help in Evaluating the Operational Risks for a Telecommunications Company? Journal of Risk and Financial Management, 14(3). https://doi.org/10.3390/jrfm14030139
Strelnik, E. U., Usanova, D. S., Khairullin, I. G., Shafigullina, G. I., & Khairullina, K. T. (2017). Key performance indicators in internal control. Journal of Engineering and Applied Sciences, 12(19), 4899–4904. https://doi.org/10.3923/jeasci.2017.4899.4904
Susanto, A. (2018). The importance of risk management in an organizations. International Journal of Scientific and Technology Research, 7(11), 103–107. https://www.scopus.com/inward/record.uri?eid=2-s2.0-85059864548&partnerID=40&md5=6bddc8f6bfccca2debedd15a598b595e
Velez, S. B. (2022). Operational risk management in banks and idiosyncratic loss theory: A leadership perspective. Emerald Publishing Limited.
Young, J. (2008). Roles and responsibilities for managing operational risk in a banking environment. Corporate Ownership & Control, 5(3).
Young, P. C., Jondle, D. J., Maines, T. D., & Rovang, M. D. (2015). Risk management and ethical cultures. In The Routledge Companion to Strategic Risk Management (pp. 57–69). https://doi.org/10.4324/9781315780931-12
Yousef, A. N. B., Taha, R., Muhmad, S. N., & Abidin, A. F. Z. (2023). Operational Risk and Financial Performance of Banks in The Middle East and North Africa. Journal of International Studies(Malaysia), 19(2), 93–118. https://doi.org/10.32890/jis2023.19.2.4
Published
2025-01-06
How to Cite
NABIL, Gymnastiar El; DIYANTY, Vera.
The Role of Risk Management in Achieving Branch Office KPIs in Bank X.
E-Jurnal Akuntansi, [S.l.], v. 35, n. 3, jan. 2025.
ISSN 2302-8556.
Available at: <https://ojs.unud.ac.id/index.php/akuntansi/article/view/122412>. Date accessed: 05 apr. 2025.
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