Every opportunity has risks in it, and every risk has opportunities in it.
Digital means both opportunity and risks. Every opportunity has risks in it, and every risk has opportunities in it. Does a lack of risk-based thinking lead to business failure? And how to shape a risk-intelligent mindset? Risk-based thinking is something people all do but perhaps many people do it imperfectly. In evolutionary terms, from risk control mind to risk management to risk intelligent mind, the successful thinking about risk leads to survival by mitigating risks, and then the accumulation of enough resources to thrive by capturing opportunities in it and adapting to the uncertainty and changes.
Risk-intelligent mind is needed to manage digital new normal. Organizations make many decisions that are based on the gut feel of the managers who make the decision. It seems that only when a project is structured and includes a charter and scope that there is an attempt at risk management. Risk management should not be handled by a few specialists and performed only when a project is chartered. Risk management should be a component of every decision. Risk awareness is a mindset to manage today’s VUCA –Velocity, Uncertainty, Complexity, and Ambiguity.
The Risk intelligent mind drives business’s risk attitude and behavior. Many of these decisions, and related risk management may seem minor, but the process should be there. Once a decisions maker is in the regimen of performing risk management for all decisions, the process becomes routine and easier to complete. However, most of the today’s risk and risk management is reserved for huge and costly endeavors. The problem with this is that poor decision-making that lack of risk awareness creates more blind spots uncovered and gaps unfilled. Such poor decision-making process excludes consideration of stakeholders and their reactions to decisions. The combined costs of many decisions without the benefit of risk management can be staggering, or even devastating to their business.
The risk intelligent mind needs to be systematic, critical and analytical to handle uncertainty management. Organizations exist to enable deployment of more resources than individuals can. Managers are paid to achieve objectives using those resources and overcome the day-to-day uncertainties. A digital mind with risk intelligence can naturally and skillfully apply risk-based thinking for almost every discipline of management, including people management, financial management, IT management, asset management, reputation management, customer relationship management, organizational structure, product development and so on.
From the business perspective, the average Fortune 500 companies’ life span has decreased to 15 years statistically, from the people perspective, as a species we’ve got this far – but how much further will we go? Be cautiously optimistic and be risk intelligent, such thinking shall not make you be fearful and hesitant to move forward; but ensure you are heading the right direction with solid speed, robust process, and well-set discipline driven by the risk intelligent mindset.
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