Innerrisks

Corporate management needs to imagine with many experiences involved in current or in the past for investigating hidden risks or uncovering gray areas, to improve business resilience.

In dealing with “VUCA” reality, risk management is very useful for achieving business results. Generally speaking, risk management is important but should be handled in a way that doesn't negatively impact business flexibility. The efforts on managing risk holistically or in a more integrated fashion are critical for the long run business viability.

Organizational management needs to define risk appetite and risk attitude so they know the business tolerance of downsides risks, have the intelligence for the upside risks: Because being "unruly" incurs risk, you need to set the updated principles and strong discipline for managing risks. There is a gray area between risk avoidance and risk-tolerance, the key is balance, and manage them well to improve business resilience.

When you are formulating strategies under conditions of known risk, as long as risks have been identified and agreed with stakeholders as per business needs, you can take information driven risk models that effectively predict, optimize, and consider sustainable approaches with multifaceted perspectives.

It’s critical to understand the risk appetite of business management, improve the risk attitude of staff, embed risk management mechanisms into corporate culture: Risk intelligent organizations are highly conscious about what’s happening in their environment, with the ability to adapt to change timely, and prevent risks effectively. Risk management mechanisms need to be well embedded in soft business factors such as corporate culture and put in place a mandated risk tolerance structure via escalation requirements based on current risk ratings.

With hyper-connectivity, people and organizations are becoming more interdependent with each other. Risk management is too inextricably linked to the company's culture and organizational personalities. It's important to embed risk control mechanisms into key business processes, measure, manage, or model risk, not just control risks, but improve methodology, technology, and overall risk intelligence.

It really means that understanding and managing risk should be a part of everyone's responsibility: The secret to risk management effectiveness is the degree to which delegation can be leveraged in "processing" risks. If senior risk managers have to micromanage all risks, eventually, key risks or opportunities will not be effectively managed.

There’re a growing number of organizations shifting their risk management orientation from bottom-up to top-down, with more senior management to assess risk profiles and improve risk management. Anyone or any company that fervently wants to be innovative must have abilities to deal with risks. Collect relevant and quality information, capture holistic risk management insight. The qualitative approach is crucial for managing risk in change.

The purpose of assessing risk against consequence criteria is to determine what risk must be managed, and who needs to be involved in transforming from risk mitigation to risk intelligence. Corporate management needs to imagine with many experiences involved in current or in the past for investigating hidden risks or uncovering gray areas, to improve business resilience.

Posted in: GRC