Explaining the Why of Enterprise Risk Management

During the North Carolina State University’s ERM Roundtable Summit this fall, one of the topics of conversation focused on how to involve more people from across the organization in ERM. During this discussion, we were all asked, “how many of you have talked extensively about ‘what ERM is’ and explained ‘we are conducting surveys, interviews, and then assessing the risks…’?” All of the hands went up.

Then, “how many have actively explained the ‘why of ERM’ for your organization?”

The answer: very few.

Then it occurred to me…I have talked extensively about the “what” of enterprise risk management (ERM) when I explained the differences between traditional risk management and ERM. And there are a multiple of “how to” resources on various topics, like risk identification, risk assessment, and using ERM to support strategy.

And I have even explained some of the “why of ERM” to you.

But what we haven’t talked about is this concept: ERM is like an internal consulting department within your organization. So instead of treating yourself like another employee or your ERM team as just another department, think of ERM like this…

You have to convince the other departments that they need the services of ERM and the value ERM can bring to them.

The reality is that you have to think about what they want to get from you, not necessarily what you want to “sell” or think they should want to “buy.” This can be a difficult reality for ERM professionals, especially since there is usually one standard process that you use across the entire organization. Another way to think about your standard process is this: you can use variations of this process, but you explain it to the department based on their pain points.

For example, if they are struggling with inefficient processes and need more people, tell them that ERM can help look at those processes and the risks they are addressing. This assistance can help determine if the processes are even needed, which would free up those people’s time for other, more valuable activities.

Another hard reality: departments will not want to work with you if they cannot relate to you.

Have you focused on building relationships with contacts in those departments? Relationships are hugely important but are often overlooked within the risk management field.

Does your ERM team have the right personalities to do the wide variety of tasks related to ERM? If your team is full of analysts but not someone comfortable talking with people or presenting information to executives, then ERM could be suffering unintentionally.

When you talk to people, show your enthusiasm for ERM. Talk about more than why ERM is important to the organization. Talk about why you are passionate for ERM. Make it personal to make that connection. A key piece of advice – ask them about themselves. Why do they do what they do? What do they love about their job? What are their biggest challenges?

The answers to these questions will give you some guidance as to how you should talk about ERM with them.

How have you “sold” ERM within your organization?

I’m interested to hear about your experiences, so please feel free to leave a comment below or join the conversation on LinkedIn.

And if your organization needs assistance in expanding the outreach of ERM, please contact me to discuss your situation today.

Featured image courtesy of “Fletcher6” 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