The Basics of Risk Management Training: What to Include in a Program
To businesses that haven't had experience with risk management training, the idea can seem like an exercise in preparing for defeat. It's true that training failures can happen, particularly when a program isn't aligned to needs and goals or isn't anchored by a robust company risk management plan. And when budgets are tight, it's tempting to think of other ways to spend the money.
However, creating a solid awareness program is a smart idea, effectively enabling a company to succeed. Once workforce and other stakeholders can learn to identify, monitor and address risk, teams can help protect enterprise value while supporting strategic goals.
Here's a closer look at some of the steps to successfully implement a risk management training program.
When leaders and team members understand and buy into the importance of risk awareness and mitigation, the business can move toward its strategic goals. Aim to educate stakeholders in protocols and mitigation tactics, but also the potential risks and risk appetite of the company. The ultimate goal: foster risk-enabled decisions and processes and improve risk governance.
Begin at the top
Leaders who embrace risk management training as an integral part of operations and processes can set the tone for the organization. Applied knowledge of risk can be a powerful tool for decision makers from the C-suite to the plant floor, impacting the quality of outcomes and allowing businesses to pivot better in the face of a challenge.
When trained in best practices, leaders also can steer their teams through calculated risks in pursuit of opportunity. Also, effective risk and corporate governance can be a boon to investors and potential industry partners.
Include all stakeholders in training
At a minimum, break down silos between teams to create a holistic approach to managing risk across the organization. Decision makers at every level can be responsible for implementing tactics that will underpin a robust mitigation strategy. When one department's remit poses a risk to another, the friction can hobble operations and dampen profits. Set up a process for handling these conflicts neutrally and train everyone in how to do their part.
Remember, contractors, suppliers, external collaborators and even customers can have a stake in the success of an organization, too. So, consider opening up risk management training and information—as appropriate—to everyone who can impact risk outcomes.
Make training and information readily accessible
In keeping with the spirit of including all stakeholders, ensure that risk management policies and guidelines can be assessed through a variety of formats and channels. These might include workshops, digital guidebooks and courses, social media posts or guest speakers at a lunch-and-learn event.
At a minimum, employees and external players should be able to quickly get reliable answers to basic questions. Don't just focus on teams that work with high-risk equipment or processes. Anyone in a customer-facing role, even the social media manager, should be able to tap into a resource immediately. When matters are complex, there should be a touchpoint within the organization—a hotline, risk team or risk officer contact—that can manage inquiries in a timely resolution.
Shape the training around competencies
No matter which formats you use, tracking the progress of your risk management training initiatives is crucial to long-term effectiveness and success. Incorporate key performance indicators to check for knowledge gaps along with noticeable improvement in the quality of risk-based decision making. The goal shouldn't be to punish or blame, but rather figure out which education and awareness efforts are meeting the needs of the company and its workforce.
For example, training sessions can begin and conclude with a test of skills and knowledge. Reviews and periodic surveys of all stakeholders can also offer good opportunities to gather information on what information needs to be better highlighted.
Because risk knowledge and mindset can influence decision quality, look for ways to evaluate risk management awareness in context. New projects can be a great time to refresh team knowledge and assess the impact of training.
Stay open to change and getting expert help
Risk management training should be a core component of your risk management strategy. Remember, organizations and their industries may transform rapidly, and the types and levels of risk they face can change at the same rate. If your risk protocols and prevention strategies must change, then your stakeholders will need to be updated. You may need to seek professional expertise to help review the program at least annually and make adjustments as needed.
Financial insights for your business
This information is provided for educational purposes only and should not be relied on or interpreted as accounting, financial planning, investment, legal or tax advice. First Citizens Bank (or its affiliates) neither endorses nor guarantees this information, and encourages you to consult a professional for advice applicable to your specific situation.