[OR] [MAS] [E3] [C9] Challenges in Sustaining Resilience

eBook 3: Chapter 9

Challenges in Sustaining Resilience

Introduction

Sustaining operational resilience is often more challenging than implementing it. While financial  institutions may successfully establish frameworks, identify Critical Business Services (CBS), and conduct testing, maintaining resilience in a dynamic regulatory, technological, and organisational environment requires continuous effort.

The Monetary Authority of Singapore emphasises that operational resilience is not a one-time initiative but an ongoing capability that must evolve alongside emerging risks, digitalisation, and increasing interdependencies .

This chapter examines three key challenges in sustaining resilience: keeping pace with regulatory changes, managing resource constraints, and maintaining organisational awareness.

Keeping Pace with Regulatory Changes

A Continuously Evolving Regulatory Landscape

Singapore’s financial sector operates within a progressively tightening regulatory environment, with MAS regularly updating expectations to address:

• Increasing digitalisation of financial services
• Growing reliance on third-party providers
• Heightened cyber and technology risks

Recent updates to operational risk management guidelines reflect the need for institutions to continuously adapt frameworks, controls, and governance structures .

Key Challenges

• Frequent Regulatory Updates
  Institutions must continuously interpret and implement new guidelines and consultation papers.
• Alignment Across Multiple Frameworks
  Operational resilience overlaps with BCM, technology risk management, outsourcing, and cybersecurity regulations.
• Implementation Lag
  Translating regulatory expectations into operational practices can take time, especially in complex organisations.

MAS Expectations

MAS expects financial institutions to:

• Maintain up-to-date frameworks aligned with current regulatory expectations
• Conduct regular reviews of risk appetite, controls, and governance structures
• Implement forward-looking change management processes to address new risks

Sustaining Regulatory Alignment

To keep pace, institutions should:

• Establish regulatory monitoring functions
• Integrate regulatory updates into continuous improvement cycles
• Conduct periodic gap assessments and compliance reviews

Resource Constraints

The Reality of Limited Resources

Sustaining operational resilience requires significant investment in:

• Technology and infrastructure
• Skilled personnel and expertise
• Testing, auditing, and monitoring capabilities

However, financial institutions often face resource constraints, particularly when balancing resilience with other business priorities.

Key Challenges

1. Competing Priorities

• Digital transformation, innovation, and cost optimisation compete for the same resources

2. Skills and Expertise Gaps

• Shortage of specialised skills in areas such as cyber resilience, cloud risk, and scenario testing

3. Budget Constraints

• Investments in resilience may be perceived as cost centres rather than value drivers

4. Scaling Across the Organisation

• Ensuring consistent implementation across business units, subsidiaries, and geographies

MAS Perspective

MAS requires institutions to ensure that operational risk management frameworks are adequately resourced and supported by competent personnel .

Senior management is responsible for:

• Allocating sufficient resources
• Ensuring staff are trained and capable
• Maintaining effective risk management functions

Addressing Resource Constraints

Financial institutions can mitigate these challenges by:

• Adopting a risk-based prioritisation approach (focus on critical services first)
• Leveraging automation and technology tools for monitoring and testing
• Building cross-functional capabilities to reduce dependency on specialised teams
• Embedding resilience into existing processes rather than creating parallel structures

Maintaining Organisational Awareness

The Human Factor in Resilience

Operational resilience depends not only on systems and processes but also on people and organisational culture. Sustaining awareness across the organisation is a persistent challenge.

Key Challenges

1. Declining Awareness Over Time

• Initial implementation efforts generate momentum, but awareness may fade without reinforcement

2. Siloed Functions

• Business, IT, risk, and compliance teams may operate independently, reducing alignment

3. Limited Engagement from Senior Management

• Without ongoing leadership involvement, resilience initiatives may lose priority

4. Inconsistent Training and Communication

• Employees may lack understanding of their roles during disruptions

MAS Expectations

MAS emphasises the importance of:

• Strong governance and oversight by senior management and the Board
• Clear roles, responsibilities, and accountability structures
• Ongoing training, awareness, and communication programmes

Sustaining Awareness

To maintain organisational awareness, institutions should:

• Conduct regular training and simulation exercises
• Communicate lessons learned from incidents and testing
• Integrate resilience into performance metrics and KPIs
• Promote cross-functional collaboration and shared ownership

Interconnected Nature of Sustaining Challenges

These challenges are interrelated:

• Regulatory changes increase resource demands
• Resource constraints limit the ability to implement regulatory updates
• Lack of awareness weakens the effectiveness of both

Additionally, MAS highlights that increasing digitalisation, interconnectedness, and third-party reliance further complicate resilience efforts .

Strategies for Sustaining Operational Resilience

To overcome these challenges, financial institutions should adopt a sustainable resilience model:

1. Embed Resilience into Business-as-Usual

• Integrate resilience into daily operations, not just projects

2. Strengthen Governance and Accountability

• Ensure continuous Board and senior management oversight

3. Adopt a Continuous Improvement Approach

• Regularly review, test, and enhance resilience capabilities

4. Leverage Technology and Automation

• Use tools for monitoring, reporting, and scenario analysis

5. Foster a Resilience Culture

• Encourage proactive risk awareness and ownership across the organisation

Sustaining operational resilience is an ongoing challenge requiring continuous adaptation, investment, and engagement.

Guided by the expectations of the Monetary Authority of Singapore, financial institutions must navigate evolving regulatory requirements, resource constraints, and organisational dynamics to maintain resilience over time.

Ultimately, resilience is not achieved through one-time implementation but through continuous reinforcement, alignment, and improvement. Institutions that successfully sustain resilience will be better positioned to navigate uncertainty, protect customers, and maintain trust in an increasingly complex financial ecosystem.

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Gain Competency: For organisations looking to accelerate their journey, BCM Institute’s training and certification programs, including the OR-5000 Operational Resilience Expert Implementer course, provide in-depth insights and practical toolkits for effectively embedding this model.

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