In the discourse of risk management, the focus often tends to veer towards systems, processes, and structures – the mechanistic essentials that help mitigate potential dangers. However, the human factor shouldn’t be underestimated. The employees of an organization, individuals with their unique insights, skills and emotions, play a pivotal part in shaping the corporate risk landscape.
In a recent piece, titled “Risk Management 101: The Human Touch” published by NAVEX, a detailed consideration of this human element of risk management has been presented. This is the second part of a series on risk management, the first part of which discussed the foundational aspects of risk management. This current installment aims to construct an insightful narrative around the significant role of the organization’s workforce amidst the complexities of risk management.
As the article elucidates, these individual contributors are not just employees executing assigned tasks; they are also the observers, reporters, and mitigators of the risks that an organization could face. Their skills, their perceptions, their understanding of the business nuances are frequently goldmines of risk-related information that can be instrumental in constructing robust risk management frameworks.
Reading from their work, observing their interactions, utilizing their suggestions and heeding their warnings can often shed light on potential danger zones long before system-based risk management tools pick them up. Therefore, creating an environment that encourages reporting and open communication is not just a good HR practice, it’s good risk management too.
The ‘human touch’ in risk management, therefore, goes much beyond simple engagement – it’s about empowering each member of the organization with the belief that they make a difference, that they are essential components in the company’s risk management mechanism.
For a more detailed understanding of the subject, you can read the complete article here.