If you want to be successful as a manager or leader, no matter which business or industry you work in, it’s important that you are able to understand how to manage risk.
In its simplest form, risk management is being aware of what could go wrong at any time, deciding if these risks can be managed or how they would affect the business, and finally taking action to avoid either the problem or its consequences.
Risk management can perfectly marry art and science and successful mangers usually have a range of special qualities across the board!
Often, good risk management goes unseen – if things go well no one knows what strategies were implemented behind the scenes to prevent disaster!
But should anything go wrong, suddenly people are asking why it was able to happen, and people also look for leadership.
So, what skills should managers have to manage risk?
Analytical risk assessment skills
It is pretty obvious that in order for any manager to asses and predict risk, you must have analytical skills, but it really goes further than that.
Being able to collect and analyse data, is one thing. But if you are able to use that data to make strategic or tough decisions, you’re well on your way to being a great manager of risk!
Another key element is taking the data and seeing any potential gaps in order to conduct further research. Therefore, you must have a desire to take things further to get a clear picture.
If potential risks are found, you must be curious enough to look at the business issue and get to the crucial solutions. If you have a yearning for problem-solving, then you’ll be able to push for the real answers and look strategically for solutions.
If you like thinking about how things affect all areas of business and are able to look at all possibilities, it’s likely you are more able to come up with solutions as well as look at opportunities.
You need to be able to see the big picture, but then break it down and find solutions and opportunities.
Financial knowledge and skills
All businesses have some element of financial risk – often the numbers can be quite scary! But a good manager can identify and measure the risk, as well as implement strategies to mitigate those risks.
If you are able to identify which risks can be managed versus which risks are beyond your control, then you can focus on contingency plans and prepare for the unknown.
No one is saying you have to do a happy dance over constant changes in regulation! But it is vital that you invest the time to stay up to date, and understand all regulation changes and updates. Great risk managers must tackle regulation updates with the seriousness that it deserves.
Ability to build relationships
You will also need to be good at relationship building because, in order to look at and manage risk, you will have to manage relationships between several different departments, as well as external groups such as stakeholders.
You’ll also need to have the ability to produce risk reports, attend meetings and present your proposals to other senior members of the management team or the board.
Working under pressure
Managing risk is inherently stressful: it means managing huge issues, problems and solutions, often with very real and expensive issues if not contained.
Having systems in place, and planning strategically, can really help you to mitigate the stress involved. Check out some of our systems and solutions already helping many businesses, and let us know which ones you think will help you.
Adaptable to new concerns and changing environments
Are you good with change?! Get good at dealing with new political, financial, and professional environments!
As a manager, each day can bring new concerns leading to changing environments in which to do business. 30 years ago, managers didn’t need to worry too much about cyber-attacks. Now, data breaches, ransomware and cyber malfunctions are real risks in business.
There are also political factors to consider: a change of government (or even a change of Prime Minister!) can lead to changing business landscapes.
And don’t forget changes within ethical and moral climates. As society changes and adapts, so does business, so you need to be willing to change along with the times.
Management and Leadership skills
Having all the skills above are great, but to really excel in risk management you need good management and leadership skills in order to support your staff to also manage risk in their departments, help the team accept changes, as well as great leadership to make it all happen.
Good managers are able to command respect while remaining friendly with the whole team.
Ability to bring your team along too
So, you’ve put in all the hard work: you constantly assess data, look for strategic ways to achieve goals and solve problems, and you can spot risks a mile off…… the next piece of the puzzle is to learn how to get the whole team on board with you!
As you identify and manage risk, there will inevitably be changes that need to be implemented in the business or learnings for the whole team. It’s your job to get everyone to see how important it is that your advice and learnings are worth listening too! Diplomacy and tact in your risk management strategy only work when everyone is on board.
Are you wanting solutions to manage risk in your business? Contact us at Rapid Global to see all of our award-winning and efficient products and services. We help businesses of all sizes, across all industries, to improve their work practices.