If you are in the process of designing a Strategic Risk Management (SRM) system or moving to the next stage, read on. Eamonn Cunningham, former chief risk officer at Scentre Group and Westfield, shares his experiences with StrategicRISK to assist you as risk managers in developing a system that will give it - and you - a better chance of success.
In today’s world it is all about relevance, nothing speaks louder than results, and for you, this means demonstrating the clear tangible benefits to be derived from what you offer the business.
Here are a few things that you need to be across to assist you in the development of an SRM system:
1. Documentation and Language
Risk Management is a specialised area. It, however, is full of jargon and three letter acronyms. Yes, what a wonderful way to show how knowledgeable and clever you are, that is of course if people actually understand what you are talking about. My message is to keep it simple, use plain language. Also, use words that your organisation understands.
2. Know the business
Something I mentioned earlier. I actually believe it is counterproductive of you to attempt to engage with the key people in the business if you do not have sufficient detailed knowledge about the business and its fundamental drivers. In particular, here figuring not only what is going on in individual departments, but almost more importantly understanding how the activities of all departments mesh together, to form the business.
3. One step at a time
Often it is better to adopt a piecemeal evolutionary approach as opposed to an all-in now one. A word of caution here, if going piecemeal, display the entire roadmap up front to your audience.
4. You need help
You need supporters and assistance along this journey. Seek out those who will be your Risk Management Champions in their own departments. Only use consultants who have done it, that is walked it as opposed to just simply talked about it.
5. Be Vibrant
Constantly display copious amounts of passion. People have to see you advocate your position with conviction all the time.
So it more than a tool, it is really a system, a way of thinking that you are deploying. Choose the system, the approach that works for your company.
And remember: In year one you might simply work with the business to run the “risk ruler” over the emerging output of the strategic decision-making process.
In year two move further up the food chain, ideally, if possible, into the decision-making room. If you cannot get into the room, that year, make sure you influence the thinking of those in the room.
As each year goes by you need to entrench SRM further.