Season 2 | Ep. 37: From Stuck to Start: Taking the First Step in Risk Management

In this episode of the Risk Intel Podcast, SRA Watchtower CEO, Ed Vincent teams up with Niki White, Chief Growth Officer to explore the concept of "starting where you are" in risk management. This discussion sheds light on how organizations can overcome the common paralysis that can come with over planning and how to take actionable steps toward effective risk management.

What Does "Starting Where You Are" Mean in Risk Management?

"Starting where you are" is a powerful concept in risk management, emphasizing that taking the first step is more important than having a fully developed plan. Many organizations delay their risk management initiatives because they feel unprepared or believe that a comprehensive plan must be in place before beginning. Niki White argues that this mindset can lead to inaction and missed opportunities. Instead, she suggests that organizations should start with what they have and learn as they go.

From her experience from speaking with many banks and credit union risk leaders, she talks about how many express interest in implementing risk management programs, but feel they just aren’t ready. The misconception that everything must be perfectly planned out before taking action is common. In reality, waiting for the perfect plan can lead to stagnation, leaving organizations stuck in the starting gate. Niki goes on to say, when you have a fully fleshed out plan, without room for adaptation, it can cause some missed opportunity or wasted money. While the Financial industry evolves quickly, risk management must as well!

“Learn what you need to know to get started, then take that step, adapt based on what you learn, adjust your behavior and approach…being prepared and at the onset knowing that you intend to adjust as you go is a critical step” – Niki White

Four Easy Steps to Help You Get From Stuck to Start

Niki goes on to offer a practical, four-step approach to help risk leaders get started with risk management:

1. ‍Learn: Begin by gathering knowledge with your current resources. This initial learning phase should be brief—just enough to get you moving forward. This commonly looks like coming up with a standard set up basic KRIs that you want to measure.
2. ‍Adapt: Be ready to adapt your plan as new information becomes available. Flexibility is key to staying on course. In Niki’s example, maybe you have a qualitative factor that you find as important. You may not be able to quantify it just yet, but if you add the qualitative factor to your risk reporting, knowing you plan to adjust it with a quantitative KRI down the road will still allow you to incorporate it and get started.
3. ‍Adjust: Make adjustments based on what you learn. This might involve changing direction or refining your approach to align better with your organization’s needs.
4. ‍Iterate: Continuously iterate your risk management strategy. By cycling through these steps, you can refine and improve your approach, ensuring it evolves with your organization and the market.

What Are the Consequences of Not Starting?

While this iterative approach to risk management offers many benefits, there are also potential consequences to consider:

1. ‍Cultural Resistance: Some organizations have a culture that demands a fully detailed plan before any investment. Adopting an agile approach may require a cultural shift within the organization.
2. ‍Overbuilding: Without flexibility, there’s a risk of overbuilding or architecting your plan — creating overly complex systems that are difficult to manage or adapt, especially in the face of turnover.
3. ‍Stagnation: The greatest risk is getting stuck in the starting gate, paralyzed by the need for perfection before taking any action. 

How Can Organizations Prepare to Start Their Risk Management Journey?

To effectively "start where you are" in risk management, Niki lastly recommends the following steps:

‍Take Inventory:

Begin by taking stock of your current resources—people, tools, risk understanding, and gaps in knowledge or data. This inventory will guide your initial efforts and highlight areas needing attention.

‍Establish a Feedback Mechanism:

‍Implement a feedback loop that allows for continuous input and adjustments. This ensures your risk management approach remains dynamic and responsive to new challenges and opportunities.

Define Clear, Achievable Goals:

Set specific, measurable, an attainable goals for your risk management journey. These goals will provide direction, keep your team focused, and allow you to track progress effectively as you iterate and adapt your approach.

Learn How To Get Started

By embracing the "start where you are" mindset, organizations can overcome the fear of imperfection and take the critical first step toward developing a robust, adaptive risk management strategy that evolves with the business and the market.

If you are feeling "stuck" or want more ideas on how to get started with your risk management program, please reach out to Niki White or schedule a meeting here.