The Seven Habits of Highly Effective Risk Managers
It is a given that risk managers must be analytical, precise and cautious. As such, they have always been seen as gatekeepers who stand in the way of more adventurous coworkers striving for lofty goals.
Unfortunately, risk managers often are required to dismiss the ambitious goals of managers, since the risks associated with the opportunity, at times, far outweigh the potential rewards. In most cases, this is where the idea that risk managers are the champion of “No” comes from. It is a risk manager’s responsibility to mitigate risk and ensure business objectives are reached.
I challenge this perception, however, and believe that risk managers can overcome it by following these seven habits, based on the foundation built by the late Stephen Covey in his work, The Seven Habits of Highly Effective People. If you, the risk manager, employ these habits, you shall achieve more business objectives, encounter lucrative growth opportunities and reduce greater risks.
Habit 1: Understand Your Role
The highly effective risk manager understands the importance of their role to the organization and, as a result, must consider the organization’s objectives, people, sustainability plans and growth strategy when making decisions. As Covey originally wrote about all highly effective people, the highly effective risk manager also “starts with the end in mind.”
Highly effective risk managers understand that their role is to seek opportunities in line with the shared vision of the organization. By operating with this understanding, highly effective risk managers can clearly communicate why the “No’s” are “No’s” and why the “Yes’s” are “Yes’s,” and illustrate how these risk-based assessments ultimately strengthen the company’s goals.
Habit 2: Collaborate
Gaining support is vital to being a highly effective risk manager. Collaboration should not stop at board-level support; it must be holistic and come from every employee. Highly effective risk managers embed themselves within the organization by being part of the whole. They understand the concerns of colleagues at all levels, from the director of the board to the custodial staff.
A risk manager is meant to serve as a lighthouse for the organization, guiding the ship away from danger and keeping it aimed at its vision. Through collaboration, highly effective risk managers work with members of the organization towards the shared goal, not against team members or objectives. Thus, the highly effective risk manager is never viewed as a rocky shore; rather, they are seen as a guide marker.
Habit 3: Think Ambitiously
A highly effective risk manager thinks ambitiously and challenges the status quo. The highly effective risk manager understands that the past does not predict future results and is willing to go outside of the norm to achieve organizational objectives.
Sayings like “conventional practices yield conventional results” and “just because it happened yesterday, does not mean it will happen today” resonate well with the highly effective risk manager. By setting their sights high, highly effective risk managers are able to go beyond their traditional role, understand all risks and take advantage of opportunities.
Habit 4: Have a Good Attitude
In any position, it is important to care about the people you work with. The highly effective risk manager has genuine concern for their colleagues and it shows. A highly effective risk manager gets to know their fellow employees, understands their concerns and exhibits a win/win attitude while collaborating with coworkers.
This is not suggesting that a risk manager should serve as the team cheerleader. Instead, the highly effective risk manager maintains an attitude that leads others to welcome their opinion and responds to requests in a supportive manner without attracting resistance.
Habit 5: Be Flexible
No matter the size of the organization, a highly effective risk manager is flexible and able to work with all departments in all situations. The highly effective risk manager seeks to understand the marketing department’s need to embark on a new campaign or why the IT department is requesting a new service vendor. And they recognize the effects of their decisions on the organization’s bottom line.
By exhibiting flexibility, the highly effective risk manager opens up new opportunities across different functions. By having the ability to adjust to all types of requests and understand the predicted outcomes, as well as the factors that make such outcomes possible, the highly effective risk manager opens new doors for their organization across all departments.
Habit 6: Remain Optimistic
By nature, risk managers must be cautious in their decision making. As such, most topics in risk management deal with the downside of risk. The highly effective risk manager understands there are two sides of the risk coin and is able to make informed decisions understanding both the upside and the downside of risk. Optimism in risk management allows for the highly effective risk manager to expand horizons and, again, open the organization to new opportunities.
Habit 7: Become An Agent of Change
The highly effective risk manager must be an agent of change within the organization. If a decision has been made, the highly effective risk manager can successfully communicate the goals, expected results and future successes associated with the change. Further, the highly effective risk manager reduces the friction associated with change by displaying an attitude of confidence that the change is for the right reason, ultimately removing the all-too-common fears associated with change on all levels.
Risk management is about seizing opportunities and understanding the potential dangers that those opportunities could reveal. When management elects to implement change, the highly effective risk manager has already identified the potential positive yields of said change. And, as such, they are willing to promote it openly and serve as a key sponsor of any endeavor that proves to be a risk worth taking.