Practical ideas: INTEGRATION INTO BUDGETING

While it is quite common to budget using three scenarios (optimistic, realistic and pessimistic) it may not be sufficient from a risk management point of view. These scenarios are often formed without the risk management team’s participation or even without due consideration of the actual risks, associated with the budget. Thus, even the pessimistic scenarios… Continue reading Practical ideas: INTEGRATION INTO BUDGETING

Practical ideas: INTEGRATION INTO STRATEGIC PLANNING

We start with strategic planning because it affects all levels of management, hence giving maximum exposure to risk management. Senior management, Board members and even some shareholders input into the process, while the rest of the company and broader stakeholders usually see the outputs of strategic planning. Integrating risk management into strategic planning helps to… Continue reading Practical ideas: INTEGRATION INTO STRATEGIC PLANNING

Practical ideas: RISK-BASED STRATEGIC PLANNING, BUDGETING AND PERFORMANCE MANAGEMENT

According to the ISO 31000:2018 principles, risk management is an integral part of all organizational activities. and decision making. Picking up on that important point, risk management should be seen as a management tool designed to improve planning, budgeting, performance management and other core business processes. Risk management also helps management to make more informed… Continue reading Practical ideas: RISK-BASED STRATEGIC PLANNING, BUDGETING AND PERFORMANCE MANAGEMENT

Practical ideas: HELP EMPLOYEES INTEGRATE RISK ANALYSIS INTO THEIR WORK

Over the years, risk managers have tried various ways to get the business units to participate in the risk management process. Some simplified the risk identification and assessment methodologies, others complicated them. The result in both cases was the same – disappointment. Best case scenario – annual or quarterly risk assessments were perceived as a… Continue reading Practical ideas: HELP EMPLOYEES INTEGRATE RISK ANALYSIS INTO THEIR WORK

Practical ideas: KEEP IT SIMPLE

The golden rule of risk management – the simpler it is, the more transparent and easier it is to understand and implement! The Risk manager’s goal should be helping organisations become more risk-based. Risk management tools and methodologies should be clear to the rest of the organisation and easily adaptable in the normal course of… Continue reading Practical ideas: KEEP IT SIMPLE

Practical ideas: Develop in-house certification for employees in high risk activities

Another useful suggestion is to develop an internal risk management certification for employees working in high-risk activities. This will ensure staff working in high-risk activities, like manufacturing, trading, insurance, security and others possess adequate risk management skills and remain cognizant of the risks associated with their work. Certification programmes may be developed internally or outsourced.… Continue reading Practical ideas: Develop in-house certification for employees in high risk activities

Practical ideas: Make risk training competency based

Just like any other business expense, a risk management training budget needs to be justified. And just like any investment decision, risk management training needs to show adequate return on investment. Training costs money: the development process, hiring trainers and getting employees to dedicate time away from their workplace to participate in training. One useful… Continue reading Practical ideas: Make risk training competency based

Practical ideas: Conduct training for “risk-champions”

Provide additional risk management training to the in-house risk management team and business units responsible for internal control, audit, finance, strategy and others. Risk managers may conduct it personally or outsource to third party providers. In-depth risk management training should include (this example is based on the actual risk management training provided by Institute for… Continue reading Practical ideas: Conduct training for “risk-champions”