1. Typical risk management processes at financial institutions like daily risk reports, value at risk calculations, and credit risk monitoring failed to prevent major losses during the financial crisis. 2. Weaknesses like not capturing all transactions, overreliance on models, and marginalizing risk managers contributed to the collapse. 3. In response, the industry will see changes like stricter governance, increased regulation, investment in risk technology, and market structure reforms to improve transparency and reduce risk taking.