ERM Implementation: What Risk Professionals Consider the #1 Challenge To Be

I recently asked of fellow risk professionals, “What is your single biggest challenge when it comes to ERM implementation?”

What do you think the answers were?

Maybe figuring out how to assess risks?

Maybe integrating with strategy?

Or aggregation of risks?


Tone at the top!

Yes, the executives and how they convey their thoughts about risk are noticed by everyone in the organization.

Tone at the top can consist of many things, such as “walk the talk” (as one respondent answered) and attitude (whether indifferent or overconfident that they know what they need to know).

What it really comes down to is organizational culture…which is set by the executives and board of your organization.

If they do not believe they need risk management, then you will not get very far. Sad but true.

You may make progress with mid-level management with operational risks and possibly project risks, but you will not be able to add the true value of enterprise risk management, which is the strategic view and supporting management in their achievement of the strategic plan.

Executives must take ownership of risk management. Don’t just say “we want ERM.” Show it to your people in your words, actions, and attitudes.

Oh, and this other thing – talk about risk. After all, risk should be embedded in daily decision-making. But if leadership  isn’t talking about it, it isn’t embedded.

And the board is not immune to this either. The board is responsible for oversight of management, correct? Then part of that oversight is asking management:

  • Are they identifying risks to the business?
  • What are they doing about those risks?
  • What are the risks that are being accepted as part of doing business?
  • What is coming down the road 5 to 10 years in the future?
  • Does management have processes in place to ensure that risk is consistently considered throughout the organization from top to bottom?

Risk professionals have a role in this challenge as well.

How are you talking about risk?

Too many times, I believe that risk professionals make things overly complex. Why do I say that?

I used to be one of those people.

We forget that ERM has to function like a business within a business.

Your organization changes products, services, structure messaging based on its customer demand, business environment, etc. In other words, the organization adapts itself.

If ERM doesn’t adapt to a changing organization, how can ERM stay relevant and meaningful to its executives?

Are you struggling to get or keep executives engaged with risk? If not, how are your executives demonstrating a positive tone at the top?

I would love to hear from you. Comment below or join the conversation on LinkedIn.

Featured image courtesy of Lloyd Smith via Wikimedia Commons


Sign Up For Our Newsletter

Sign Up For Our Newsletter


Meet Carol

Helping companies achieve their vision and strategy, and succeeding in today's turbulent world, is something I'm honored to be a part of. Whether you're an occasional blog visitor or a long-term client, thank you for letting us be a part of your journey.

Most Recent Posts

The 12 Days of ERM Christmas

Without a doubt, one of my family’s favorite holidays is Christmas. Part of the fun, especially for our son, is seeing what “Santa” brought, but most importantly, we treasure the spirit of peace and goodwill the season brings. And after what seemed to be a never-ending warm spell, the weather is expected to be good…

Read More

Don’t Let Goals and Initiatives Be Blindsided by External Events

As the end of the year draws near, I think we’d all agree that while it wasn’t without its challenges, this year also wasn’t quite as turbulent as the previous two. While a lot of people are juggling company parties, shopping for friends and family, and special activities for the kids, most companies are putting…

Read More

Going the Distance: Ensuring Successful Execution of Strategic and Annual Initiatives

Strategic planning is a challenge – of all people, I understand… After all the meetings, risk and data analysis, and brainstorming of the preceding months, it’s tempting to think this is the end of the road and you can relax. Contrary to this common perception though, this is exactly not the time to relax, but…

Read More

Avoid Rookie Mistakes and Protect your Internal Reputation

Be honest – have you ever done something that you soon realized was a real rookie mistake? Me raising my hand… Considering the nature of ERM’s role to ask questions and challenge assumptions (often during conversations with executives), it can be argued that, in at least some cases, the expectations bar for risk professionals is…

Read More

ERM at Thanksgiving – An Illustration of Risk Management in Action

On occasion, I like to take some of the concepts we risk professionals think about in our jobs and apply them to different personal situations…take some of the same concepts we use when working with executives to develop corporate strategy and manage risks or uncertainty around that strategy. It’s Thanksgiving week in the U.S. –…

Read More

Why Quantitative Risk Assessment is Not Just the Best But the Only Option – A Conversation

Periodically, I have the pleasure of speaking one-on-one with Hans Læssøe on a variety of topics around ERM, strategic risk, and other issues and trends. As you know from my previous conversations (here, here) and posts featuring his work, Hans was formerly a practitioner at the iconic LEGO Company, but even more notably, is a…

Read More

The Three Lines Model – 3 Reasons Why I Don’t Like It

Everyone likes a clear-cut template that offers an easy way to create or manage something…I mean what’s not to like about a step-by-step process for accomplishing what you want? Sometimes this can work without any issues, such as the case with the Project Management Book of Knowledge (PMBOK), ISO 9001 standard, or a new cooking…

Read More

5 Avenues for Expanding your ERM Knowledge

One thing I was taught to appreciate from a young age was the value of education and knowledge. It didn’t necessarily matter what the subject was, just that I always maintain a learning or growth mindset regardless of my current status in life. This mindset has served me well over the years, and it’s a…

Read More

Storytelling and Risk Management – Developing Skills that Technology Cannot Replace

It’s amazing how technology has developed and changed our working world over time. Imagine trying to run my risk and strategy consulting firm without tools like Zoom, Box, Slack, and other ERM-specific technology tools. There is no way we would be able to serve our clients the way that we do. Just consider how the…

Read More

3 Phases to Creating and Launching an ERM Program Focused on Organizational Success

If you’ve been handed the task of creating an ERM program for your organization, let me first offer my congratulations quickly followed by my empathy for the task ahead of you. I don’t say that to scare you but to provide a small dose of reality. Building, launching, and refining an ERM program that is…

Read More