What Tomorrow Brings… How to effectively manage risk in your business

16th September 2016

Creation of a Risk Profile

Ask a group of corporate leaders to identify their key business risks and the answers are diverse:  Order book; Cash flow; Access to the correct logistics; Attracting and keeping talent – occasionally it may include the impact of new government requirements such as the Apprentice Levy (UK).

Rarely is a comprehensive list of risks (risk profile) available. Even more scarce is a list featuring occupational or process Health & Safety.  Reasons for this include:

• Risk profile creation and monitoring within the normal business processes is not undertaken as it feels like a hindrance vs the agile response required by the marketplace.
• The business presumes that senior leadership – using their knowledge, personality and drive – will swiftly resolve any such challenges.

Where a risk profile is available, incorrect perceptions can arise:

• Considered a one-off process.
• Implementation of controls = activity is complete!
• No impact assessment following the implementation of controls – has a difference been made?
• Health & Safety too insignificant to include.

A good risk profile should generate a road map of key risk control actions. Reviewed regularly at all levels, this road map will drive proactive input and activity and have a huge positive impact on the operational efficiency of an organisation.

Effective incorporation of the Risk Profile into day-to-day business

Ultimately a successful risk profile comes down to the desire of the senior management team to create and use it to their advantage.  A comprehensive risk profile owned by a risk manager and residing in a management system has essentially the same value as no risk profile!

Succinct, efficient and keeping all key risks visible and in play at all times, the risk profile sets the tone about what the business sees as important. Scrutinised during scheduled leadership and management forums, it trickles into what the workforce will value and focus on.

An effective risk profile with associated management arrangements ensures you are always ready for tomorrow!  Consider the following checks to ensure success:

1. Identify the key risks in your business – how have you mitigated them?
2. Consider how you periodically monitor those key risks – ensure you are not losing control or overlooking an emerging risk.
3. Establish how the outputs in your risk review process link to your business planning and budgeting processes.
4. Assess whether the entire business has a consistent view of  the key business risks.
5. Ensure you don’t become normalised to risks that should cause unease – take steps to generate a steady challenge around the effectiveness of controls.

Correlating words and action drives safer working behaviour.

Thinking about Health & Safety in this way challenges the level of control we think we have or highlights blindness towards significant unresolved risks in our businesses. These risks may relate to winter weather or to something more tangible like structural safety or workplace transport.

This way of thinking also allows us to see Health & Safety as one of an important group of key risks that, as business leaders, we have to address.  It enables us to abandon the simplistic line of thought that drives us to state Health & Safety is our number one priority when our behaviours demonstrate that is clearly not the case.