Business management puts emphasis on risk management to risk intelligence transformation.
In business, every day is a risk, but when a company embarks on a growth strategy, the risk curve will always be greater than a “business as usual” approach. In order to survive in “VUCA” reality, there are many out there that simply don’t understand, or appreciate the benefits of risk and opportunity management to an organization, which always makes it difficult to introduce risk management in general, let alone strategic risk & opportunity management.
The leadership approach toward risk directly impacts how the business functions, its agility, and speed: As strategic risk management is a critical component of business strategy. Top management commitment is important to build risk awareness culture successfully. It follows that the primary focus of the risk management process would be to identify and control those risks that can be addressed. The corporate board has a role in orchestrating an effective enterprise risk management to manage risk effectively. A really high-quality risk appetite discussion between executive members and the board is crucial to set the right risk appetite and establish good policies to encourage good risk attitude and behaviors; and improve GRC effectiveness.
View risk management as an integral part of strategy management practices to accelerate performance and improve business agility and maturity. A sound risk management platform integrates risk management into the enterprise’s core decision-making processes, as well as the business planning processes; and integrates GRC practices to improve business responsiveness and speed.
Risk is part of innovation, but you can manage parts of these risks: Innovation by its inherent nature comes with a risk. Innovation fails because many organizations lack a cohesive strategy or a systematic approach to manage both opportunities and risks in a structural way. Consider the continuum between innovation and standardization; creativity and process. The matter is to figure out how and when to apply them in the most effective way; between the new way to do things and the best practice, between risk management and risk tolerance.
Reputation is part of a brand, and the brand usually reflects the personal and enterprise reputation: Individual reputation and their mindset is correlated; while corporate reputation and culture are intertwined. The organization’s brand equity is the key asset of concern when it comes to the question of reputational risk.
If the management has put in place effective GRC processes for protecting business brand and reputation, it helps to clarify what the brand stands for, how the company lets its stakeholders maintain their reputation; perceive the brand name and the connotation it wants its stakeholders to associate. You can’t and won’t be able to manage or predict every risk, but by mapping and measuring complex interactions in real-time can gain early warning with anticipatory awareness of possible, plausible negative impact on reputation management.
Either individually or as a team, risk management is very useful for achieving high performance business results. Business management puts emphasis on risk management to risk intelligence transformation; set good policies deepen their understanding of potential risk, collect more information on risk culture assessment, automate and optimize important processes to unlock business performance.