Embedding Sound Risk Management Practices into an Organization
Core principles for risk management adoption within an organization.
When government, academic and business leaders gathered in Davos, Switzerland, for the World Economic Forum, risk management was a primary focus, according to Wharton School of Business Professor Michael Useem.
The leaders who experienced first hand the global upheaval caused by everything from political uprisings to economic depression and natural disasters are in a prime position to share what worked or didn't work in the aftermath of those events, he said. And those who weren't as directly impacted were more than willing to learn. The World Economic Forum's Risk Response Network grew out of that circle of learning, according to Knowledge@Wharton.
The network is designed to help leaders "better understand, prepare for and manage new risk landscapes." It will do that, in part, by gathering what the forum website calls "a new and unique community of risk officers" from business, government and international organizations to offer their insight. The network will also develop proprietary risk analytics and risk management processes.
The World Economic Forum has created an on-going platform to give those engaged in risk management better access to detailed data, proven practices and experienced players.
Though the risks addressed by global leaders will necessarily be bigger and more complex than those tackled by corporate boards of directors, the basic elements for improvement remain the same: Make sure you're getting a complete picture of your entire organization's risk landscape. Outlining risks by department or area won't necessarily show how many of them intertwine and overlap. Remember to revise your processes and practices if they're not yielding desired results. Don't be afraid to ask those you know (and even those you don't) who manage risk well how they do it.