Successful Risk Programs: Be Strategic

by Mark Carey, CEO, DelCreo, Inc.

Do you want the budget, resources, and management support for your risk program to be a success?

Then, be strategic.

In my more than 10 years in the field of risk, I have observed that strategic planning does not seem to be an area where many Risk Professionals excel. However, in a recent conversation I had with a Fortune 50 CFO, the key question on the table was, "How should my company align and integrate our risk management activities into the strategic planning processes used by our businesses?"

I have conducted many interviews with Risk Professionals to ask them what challenges they face, and I consistently hear the following two answers:

"I am always struggling to get adequate budget, people, and tools necessary to do my job."

"It is difficult to get the attention of our executive management team until something bad happens."

Sound familiar? If so, rest assured, you are not alone.

Effective strategic planning, especially the process that you have to go through to develop a strategic plan, will go a long way toward helping you address these challenges. The plan itself is not as important as the process, the thinking, and the garnering of management support.

Your strategic planning should accomplish the following:

FOCUS: Which risks specifically will your risk program focus critical resources on managing? What risk management capabilities (processes, investments, resources, and related activities) will be required? How will they be coordinated across the enterprise?

VALUE: How should your risk program measure the results and demonstrate the value of risk management processes, investments, resources, and related activities?

OBJECTIVES: What are the goals of your risk program? How will your risk program benefit your organization and its key stakeholders?

The benefits to your risk program when going through a strategic planning process and developing a well thought out plan are many, but here are several that my clients have benefited from:

The information gathering portion of strategic planning provides an excellent opportunity to interview and receive input from executives that you may not often interact with. This will give you exposure with those executives while allowing these executives to participate in the development of your risk program and "buy in" to the ultimate outputs of your strategic plan because they've had a stake in it.

It forces you to rationalize your current and future activities...