Common Symptoms Risk Management Approach

 

Risks are also often managed centrally through management team channels. Organizations commonly lack the insight, scope and flexibility to handle risks that occur at a grass-roots level, where the work gets done. Decisions to prevent and mitigate risk can sometimes be delayed as employees do not have the capability to assess risk, or the time to define and reduce the risk. 

 

The following are common symptoms which could highlight to you that your approach to risk management could be improved:

  1. Uncertainty – the organization struggles to collect the right, or enough information about its risks. Checks are too infrequent, must be recurring and beyond annually. The scope of information about the organizations risk is narrow.
  2. Complexity – the organization is collecting enormous amounts of information about risk to the low level weeds areas. Decision makers cannot interpret the information. Opportunities are overlooked.
  3. Ambiguity – the organization is not able to formulate the correct questions in order to understand its risk. Additional information is useless because risk is not understood or documented effectively, and is some cases not documented at all.
  4. Lack of Common Language- there are multiple interpretations of risk between individuals across the organization. Risk management is mutually exclusive or in conflict. A power struggle usually ensues between individuals with conflicting views and beliefs.
  5. Silo mentality (larger organizations) – different departments resist communicating information about risks across the organization. This typically leads to a condition of both uncertainty and not my problem mentality.

Defining, mitigating and eliminating operational risk factors requires a holistic team approach.  Get your employees at all levels involved!  

One Response to “Common Symptoms Risk Management Approach”

  1. Articles and content in this section of the website are really amazing. Great ideas indeed! I will surely keep these in my mind!

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