From our experience assessing and implementing Enterprise Risk Management (ERM) programs across the country, Provident has identified seven key elements for success:
- Phased Approach – ERM programs involve active engagement from leadership as well as on the ground operational teams. Enhance or develop your program in phases, allowing for organizational buy-in, infrastructure development, risk identification and alignment of strategy and resources.
- Leadership Buy-In – Essential first step. Leadership must be not only supportive but also engaged in the process. Project team should work with leadership in developing the workplan to help the project team align organizational goals and strategy.
- Definitions – Before conducting the risk assessment, the organization must define categories of risk, levels of risk and risk tolerance. These definitions and boundaries provide the framework for the risk assessment.
- Comprehensive Risk Assessment – The foundation of your ERM program. Utilize facilitated group sessions that include individuals at all levels across the organization to obtain the “on the ground” perspective. Leverage past risk identification projects and internal/external audit findings, assess repeat risks and mitigation strategies and rank the collective risks identified.
- Regular, Transparent Reporting – Develop dashboards to report risks, mitigation strategies and progress for transparency at both the operational and leadership level. Use these reports in future assessments for risk prioritization.
- Organizational Alignment – Risk prioritization and mitigation strategies must align with organizational priorities to ensure focus, support, resources and follow-through.
- Communication Protocols – Identification of risk cannot stop when the project ends. Encourage risk identification across the organization with well-publicized communication protocols and reporting structures. Engage operational leadership!
To learn more, visit our website at www.providentedge.com or contact Valerie Reich at vreich@providentedge.com.