Overcoming the Biggest Hurdle in Enterprise Risk Management (ERM) Implementation… Just Do it
Many organizations wonder what the biggest hurdle in implementing enterprise risk management (ERM) is.
The answer is quite simple: getting started. There is only one way to overcome this hurdle and that is to Just Do It!
Many organizations contemplate, discuss, meet and devise action plans related to the implementation of risk management, only to get distracted by what they consider “regular business.” This is the biggest roadblock for many ERM initiatives.
Why do organizations lose steam even before they start?
Typically, it is because they see the task of implementing ERM as too large, too complex, or needing too much of the organization’s involvement to be effective. This is far from reality and I will provide some practical advice, based on my experience working with many clients across numerous industries.
1. Find the area of the business which is most critical, or poses the biggest problem to the organization
– The entire organization doesn’t have to have to be handled all at once. Instead, view the process as many pieces handled a little at a time. If there is an area which is critical to the organization’s success, start there. Get some wins, show some success, and over a period of time, the entire organization will be covered.
2. Show how ERM is beneficial and adds value to those involved
– People do not like to feel that they are being forced into something. An initiative dictated from “the top” is usually something that is greeted with hesitation. If you are going to be successful, you will need to translate ERM into a benefit and continuous process for each department and individual involved. Is what you are implementing going to result in less work, better results and performance, a safer workplace, etc.? Most people want to do things which will make them more efficient and effective at performing their duties.
3. Reward and Show Success along the way
– The implementation of ERM is critical to any organization, including not-for-profit, government and educational institutions. However, the creation of a fluid process is by no means an easy task. In order to get everyone to embrace it, show success, reward effective behavior, and reinforce progression and milestones. Upon completion of a successful risk assessment activity or workshop, properly communicate to those involved and show them you appreciate their hard work.
4. Communication is Key
– Implementing an ERM program is a process, not a project. It’s important that you communicate progress and results, and check in often to ensure those involved are comfortable with performance. Look to continue to communicate the What, When, Where, How and Why on a regular basis and ensure the communication comes from all levels, not just the top. It’s important to know that your executives support it, but it is also important to know the people you see on an everyday basis are on board as well.
The key to a successful ERM implementation is to get started with a risk management mindset, understating the key performance benefits. There is no time like now to start or review your current process to ensure your receiving the most of your program. ERM, at its full potential, should provide many benefits, including dealing with the downside of risks and benefiting from the upside. The process can have a huge, positive impact on your organization. The key is to get started and continue to refine it along the way.