Risk voting is an easy, effective way to engage your business users and improve the quality of information in your ERM program.
So you’ve got your enterprise risk program off the ground and your executive team is receptive. Congratulations- that is a great position to be in. Now, how do you capitalize on this momentum and drive your risk program forward into the organization?
Alternatively, perhaps your ERM program has stalled after some early success and is now drifting dangerously towards becoming a dreaded annual checkbox activity. How do you reinvigorate your program and re-engage your executive team?
One great answer for both of these questions is risk voting.
If you are unfamiliar with the concept, risk voting is the process gathering risk rating information from a variety of business leaders and subject matter experts in your organization. Each contributor is given the opportunity to provide their own scoring for the elements of individual risks, such as the likelihood, impact, control effectiveness, risk tolerance etc. The values are consolidated and used for input into the overall rating of each risk.
Performing risk votes is not particularly difficult and there are multiple ways to do it. Some organizations keep it as simple as using online survey tools. This makes it easy for contributors but creates a large amount of work for risk managers who have to tabulate results and generate reports manually. An improvement over this is to use an ERM tool that has built-in voting functionality and does the tabulation and reporting automatically (disclaimer alert – our company produces the Essential ERM system and we are soon launching a new approach to risk voting).
Regardless of how you do it, voting on risks has many important and immediate benefits for your ERM program.
First, voting helps to eliminate some of the groupthink that can creep into risk workshops. When votes are done in real-time during a live risk discussion, some participants can be drowned out by louder voices in the room. There can be fear of speaking up against powerful individuals. It can be tempting for participants to simply follow the lead of the “big boss” in the room. Not every organization faces these dynamics, but there is no question that a more pure, organic result is achieved when your workshop participants can vote freely and anonymously. Results can be discussed immediately as a group and votes can be rerun where there is a need to generate consensus – all without drowning out important contributions from less forceful participants.
Second, risk voting can help you better prepare for risk sessions and use your executive team’s time more effectively. Votes can be conducted “offline” through emails that lead contributors to voting screens that they can complete on their own schedule. If this is done for top risks in advance of a risk workshop, it can help you identify the areas where you want to focus your time during the in-person discussion. For example, if you have a high degree of agreement on ratings for risks that are middle-of-the-pack in scoring, do you really want to focus as much time on them in a workshop? Perhaps all they need is a quick review of action plans and a more productive approach for your workshops would be to zero in on the risks that do not have a clear consensus from your management team.
Third, when you distribute voting out more broadly into the organization, you have the potential to engage more people into the risk management process. This helps you enhance your risk management culture and helps you gather input from the people who are closer to your daily operations. Not every risk or rating they identify will make it into the enterprise view that you share with your executive team and board, but you will definitely uncover some gems of insight that would not normally make their way up to the leadership team.
Finally, risk voting can play an important role in enhancing engagement in your enterprise risk program. Think about your own level of engagement in a subject when you are given the opportunity to vote on an online poll. As a participant in a vote, you are interested in the results and feel a sense of ownership for the outcome. The same is true for the risk votes you conduct. Your participants will be actively thinking about risk inputs and making risk decisions. Healthy debate may ensure, but your team members will be better engaged in the risk process, gaining useful experience and building up your organization’s risk culture. You will also be generating a treasure trove of information that can be later analyzed to gain new insights into how your organization makes risk-based decisions.
We’d love to hear your thoughts and experiences with risk voting. Is there anything we have missed or any tips and thoughts you can share? If so, please comment below or reach out to us – we’d love to chat.
Tracker Networks Inc.