When I have asked various industry leaders what does their Sales and/or Service culture look like and how is it effective they almost always perk up and deliver an enthusiastic and detailed account. However, when the same question is asked about their Risk culture I am usually met with pause, shrugged shoulders and generally at best a high-level “we do a good job managing risk everyday” type of response.
Now this is not to say that there aren’t plenty of organizations out there that fully understand and can articulate their risk culture. I’ve had the pleasure to discuss with many leaders their risk culture and how it was developed and continues to thrive. However, it’s becoming increasingly apparent that there are just as many who struggle to effectively describe their risk culture or if they even have one.
Is this because businesses don’t feel they need a risk culture? Could it be they don’t want to create one? I think the logical answer is of course they want and need a risk culture. Unfortunately, the day-to-day of ensuring they maintain and nourish their sales and service culture seems to take priority and therefore the majority of their focus. In addition, building and maintaining any type of successful culture is hard and a lot of work.
An effective risk culture incorporates the employee’s consciousness, attitudes, and actions toward risk and how it is managed. Moreover, it’s a mindset within the organization that the employees will make well informed risk decisions since they realize organizations must take adequate risk to produce value.
Making sales and service decisions in the absence of risk considerations not only places the organization in harm’s way but ultimately erodes part of the very sales and service value they strive to deliver. Whereas employees taking responsibility for managing risk in a comprehensive risk culture can flourish by enhancing the overall value not only for the organization but more importantly, it’s customers.
Just as each organization is unique so too is its culture. Generally, there are always similarities within every culture that provide a foundation for its construction. Although there are many parallels most risk cultures do share the following:
These similarities if levied across most organizations sales and service culture would likely mimic each other as well. The lesson here is that you can take many of the same principles that you used to create and maintain your various cultures and apply them to risk.
So ask yourself:
If you don’t know the answers – find out. Everyone beginning to have the same understanding is the first step in creating your risk culture and how it needs to be enhanced and encouraged.
You can have the best systems, processes and models but at the end of the day it’s still your employees that are making the day-to-day decisions. Having them all doing this from a risk vantage point that drives value to your other cultures will ensure a higher level of success for them, you and your customer’s.
So when we meet and I ask you, “What’s Your Risk Culture?” I can’t wait to see your excitement as you begin to describe your risk culture success!