What Skills Do You Need to Be a Successful Risk Professional?
Businesses are exposed to a blizzard of risks daily – from strategic risk and regulatory compliance risk to financial risk and operational risk. They have two choices amid this onslaught: adopt a reactive risk management strategy that is focused on damage limitation after a disruptive event or identify risks before they happen and develop strategies to avoid or alleviate them. This proactive approach seeks to reduce a risk’s potential impact or, even better, prevent the threat altogether.
People are the fulcrum of proactive risk management – it is up to these dedicated risk professionals to determine potential risks, understand the root cause, prioritise them, and prepare contingency plans. To do this successfully and shield the business from this barrage of risks before they become disruptive incidents, these individuals require a diverse skillset – including;
Fundamentally, risk professionals analyse risks, calculate their potential impact and balance them against the organisation’s overall risk appetite – but there is much more to this than just collecting and analysing data. The most effective risk professionals harness the data to make impactful strategic decisions and identify potential gaps in the data to initiate further risk-related research.
Risks are perpetuated when they are managed in isolation from the rest of the organisation. To overcome the challenges presented by this siloed approach, risk professionals must tackle these threats holistically. This process of integrating risk management into each department requires robust communication skills to ensure everyone understands and buys into the risk management strategy.
From meeting with the board of directors to updating individual employees, risk professionals must engage with all levels of the organisation to achieve a proactive top-down and bottom-up risk culture.
Strategic thinking skills
The most influential risk professionals understand how proactive risk management can empower the business to achieve its goals. This strategic mindset allows them to assess how risks can affect the business as a whole and use this information to identify opportunities or more efficient ways of operating. For example, rather than always viewing risk as a burden, they possess the foresight to seize potential market and competitive opportunities arising from it.
Ability to work under pressure
Risks are dynamic, meaning they can occur or change in an instant under the influence of the forces that control them – often with serious consequences. Risk professionals must, therefore, possess the agility and assertiveness needed to react at a moment’s notice – from implementing business continuity plans to updating strategies. With the threat of operational, financial, and reputational damage looming large they are under immense pressure in these moments – and must stay calm.
An organisation’s exposure to risk is in a constant state of flux. One day, a risk professional may have to manage a cyber-attack; the next, they could be implementing measures to ensure compliance with a new regulation. The fluidity of their role means they are expected to be creative, flexible, and able to prevent or solve any problem that presents itself – at any time. This requires them to augment traditional decision-making skills with the courage to implement innovative ideas.
To identify, estimate, and prevent risks it is essential to both understand how the organisation works and the internal and external variables that can impact its performance. Equipped with this knowledge and understanding, risk professionals will be well prepared to contribute to the development, communication, and execution of the risk management strategy. They should also be aware of the wider risk landscape within the industry the organisation operates for a truly holistic approach to risk management that is informed internally and externally.