ERM Maturity Assessments: Are we assessing the right thing?

At the end of my first year of managing the ERM program for a large Florida property insurance company, we had a big risk consulting firm come in and assess the maturity of the program.

ERM maturity assessments measure where your ERM program sits on a scale (typically 1 to 5 or words that label the numbers) in a variety of areas. Sounds great, right?

I mean, executives love them…

It puts the program in black-and-white terms, comparing what the program is doing in comparison to other organizations, and telling management what needs to happen to make it “better.”

When it came to the assessment for my former company, there were interviews with executives and upper management, a review of governance  documentation, and interviews with me and my team. And we fared decent in some areas, already ranking a 2-3 for program governance, but 1-2 for the actual risk management process, etc.

Looking back several years later, I realize that the assessment they conducted was really a combination of a maturity assessment and an effectiveness assessment.

Isn’t that what we should be measuring? How effective the ERM program is for the organization?

After all, it doesn’t matter what other organizations are doing for ERM — what should only matter is the existing ERM program is effective for your organization. Your organization may not need a really mature program; what you have now is working great. Or the organization tried taking steps to mature but realized it wasn’t really ready to have the additional steps in the process or information. Some organizations, frankly, don’t have a risk culture mature enough to accept a mature ERM program, which means you need to focus on risk culture before you try to develop the program further.

Not to mention, why did the executives tell the consultants things that they didn’t feel comfortable telling us? That should be a red flag right there!

If your executives do not feel comfortable telling you that there are parts of the program that they have problems with, you have a bigger problem on your hands! Every program needs champions, but executives not talking to the risk management team means that they could be the exact opposite of what you need…which will negatively impact the effectiveness of the program.

What kind of information would you like out of a program assessment — maturity or effectiveness? 

To learn more about this topic, I invite you to check out 5 Simple Questions for Assessing the Effectiveness of ERM Processes.

I also invite you to share your thoughts on ERM maturity assessments, leave a comment below or join the conversation on LinkedIn.

And if you are looking for a maturity assessment specific to your organization that will be useful for moving your ERM program forward and improving the effectiveness of your program, please don’t hesitate to contact me to discuss your needs today.

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