The importance and timeliness of risk management have increased exponentially because of the pandemic across the globe. Risk management has always been a critical part of any business however it has never been so urgent. Every business must manage risks, but these risks need to be researched and assessed. Businesses need to discover these risks to ensure that their strategic plans are sound. The risks caused by the pandemic are very different – they didn’t need to be discovered; they are so major that they are impossible to ignore. This has changed the nature of risk management for the foreseeable future.

The traditional role of a risk manager

This change can be understood easily if we think of a business as a ship that is crossing an ocean. A ship is very similar to a business – it has a vision, there is a captain who works with the top management. There are hundreds of people controlling big ships and everyone must play their part to ensure a smooth journey – the exact same principle applies to businesses. In this context, the risk manager is the person who must make sure that the ship is charting a safe course and every risk is managed. The risk manager of a ship looks at things far away through binoculars to ensure the ship doesn’t hit anything, uses maps of the sea to chart the safest course possible, reads weather reports to make sure the ship isn’t surprised by a storm, and so on. Risk managers need a risk management framework that can enable them to deliver the level of risk mitigation and management businesses now require. Share on X These are all things that a risk manager does to avoid or mitigate risks before they affect the business. The current pandemic is not such a risk and cannot be compared to the usual risks that a ship goes through. Think of it this way instead – the ship had no way of knowing that it was heading into rocky seas (because there is no way to predict the outbreak of a new virus). Now the ship is in unstable waters, there are rocks damaging the hull, and the ship needs the risk manager to help navigate safely.

The thing to note here is that the ship now needs the risk manager to fulfill a new role that plays an active part in every process. The ship no longer needs the risk manager to look at weather reports or a map – it needs the risk manager to look out the window and assess the damage as it happens. It needs the risk manager to be reactive and provide the latest information about the damage caused and repairs needed. Everything shifts from a daily reporting schedule to a real-time reporting situation. That is exactly what is happening to risk managers in businesses across the world.

The new role of enterprise risk managers

Now that the risk of the pandemic has begun to negatively affect businesses, risk managers are in higher demand than ever before. Risk is no longer something which needs to be managed to ensure that the business can continue making a profit – risk management is now a necessary tool for the survival of a business not just in the long term but in the short term too. Risk managers are being asked to stay informed about the progress being made to fight the pandemic. They are being asked to provide real-time reports on how the different parts of the business are affected by the risk and what steps need to be taken to minimize the damage caused by the pandemic.

Delivering critical information at the right time

Risk managers need a risk management framework that can enable them to deliver the level of risk mitigation and management businesses now require. This framework will need to have a strategy and the tools which can allow the risk managers to change the way they work in many ways:

Real-time reporting

There used to be a time when businesses could survive with monthly or even quarterly risk reports. This is no longer true. The pandemic has created many risks which are evolving, and businesses need daily risk reports to ensure that everything goes smoothly. Real-time reporting can help the executive management stay on top of the issues and quickly change the course of the business whenever required.

Faster risk assessments

Delivering reports at a faster pace is only possible if a risk assessment is being done at a faster pace too. Risk managers need a way to communicate with the rest of the organization to collarbone on assessing risks. They also need an automated tool which can make the analysis part of the assessment faster.

Enterprise-wide visibility.

Risk managers need to have enterprise-wide risk visibility. They can only understand how the risk is affecting the organization as a whole if they can see how different departments are being affected by the risk. There needs to be a way that the whole organization can provide instant information, metrics, or reports to the risk manager.

These are just some of the ways that risk management is changing during these times. If you are wondering how you can work faster while at the same time increasing the scope of your risk management practices, then you need to look into using technology to augment your risk management processes. Get in touch with our risk management experts to see a demonstration of our risk management solution.