Product Leadership

A strategic approach focused on producing a continuous stream of state-of-the-art products or services. Organizations pursuing product leadership strive to offer the most innovative and appealing products in their market, relying on creativity, rapid commercialization capabilities, and speed-oriented processes. This strategy, described by Treacy and Wiersema, requires substantial investment in research and development, willingness to cannibalize existing products, and tolerance for product development risks. In RBPM, organizations pursuing product leadership must define appropriate risk appetite levels for innovation activities.

Process Alignment Matrix

A tool that visually demonstrates the relationship between operational processes and strategic objectives, risks, and/or controls. The matrix indicates the strength of alignment using percentage values (ranging from 0% for very weak alignment to 100% for very strong alignment). This tool helps organizations ensure that day-to-day activities support strategic goals and identify potential gaps where important objectives or risks lack enabling processes. It promotes cross-functional discussion and helps integrate strategy execution with operational management.

Preventive Controls

Controls designed to deter or stop errors, irregularities, or adverse events from occurring. Preventive controls act before a risk materializes and help reduce the likelihood of negative outcomes. Examples include authorization requirements, physical access restrictions, segregation of duties, and input validation routines. Within RBPM, preventive controls form a first line of defense in the risk management framework. They help maintain risk exposure within appetite boundaries by addressing potential risk sources before they can cause harm.

Performance Scorecard

A management tool that tracks and reports on an organization's progress toward achieving its strategic objectives. It includes information on objective owners, appetite alignment status, KPIs, and performance scores. The Performance Scorecard helps senior management answer questions about whether the organization is achieving desired performance levels, whether performance is improving over time, how strategic initiatives are progressing, and what performance exceptions require investigation. It complements the Risk and Control Scorecards to provide a comprehensive view of risk-based performance management.