Important things in life are not easily reduced to 10 steps. Nevertheless, this series provides a list of 10 building blocks to achieving long-term success in risk management from someone who has spent more than 25 years striving to carve out the most satisfying career possible, while never losing sight of the attributes attached to the bigger picture. The first article in the series, covering the first two steps, is here. This articles covers steps three and four.
3. Industry Background
Many accomplished risk leaders have come up through the insurance industry, from within brokers, insurers or consultants or from the myriad of industry service providers such as claim administrators, loss prevention providers and actuaries. All of these fields are valuable for providing that broad swath of knowledge that engenders long-term success. But now that risk management is evolving into a much broader discipline, under different labels (e.g., enterprise risk management, strategic risk management or integrated risk management), the question remains whether traditional insurance-based beginnings are still the best preparation for a career in risk management. Or, are there other fields that might provide better starting points?
This new risk management realm requires greater breadth of knowledge to be successful. For example, it calls for greater skills in influencing others. These types of leadership skills are especially critical because success is often a function of securing buy-in and support from senior managers and even board members. But that doesn’t mean that the traditional areas of learning and insurance industry expertise shouldn’t be pursued .
The basic tenants of for risk leaders — risk identification, assessment, measurement, mitigation, monitoring and reporting — are as applicable as they ever were for the effective management of all risks, from A to Z. Gaining expertise and knowledge in many areas of risk management is helpful to developing the broad understanding needed to provide effective risk management advice to the enterprise. Such broad understanding is gained only by spending time in the right trenches, ideally with mentors who can guide the way through politically charged minefields. In addition, time spent in audit, compliance, legal and even process engineering can provide valuable insight into areas where relationships must be developed to understand their priorities and how they overlap with those of risk professionals.
4. Getting Involved Outside the Organization
Leaders of all types do not limit their leadership abilities to only one firm. Generally, good leaders lead everywhere, and leadership skills can help move a risk manager’s interests forward. This means that, while showing leadership internally is job one, demonstrating leadership in the broader discipline or profession is also important to long-term success. Getting involved outside their own organizations allows risk managers to have leadership experiences that broaden knowledge and hone political skills. This is especially true if the risk manager’s own company provides few opportunities to develop leadership skills. Often, these developmental opportunities within the organization are reserved for a few individuals who have been identified as “high potential,” whether accurately or otherwise.
An external development strategy may be hard to execute when the work environment is particularly challenging. It is also heavily dependent on what’s commonly known as “who you know” to connect to key external entities and leaders. So, risk management personnel should consider trade and professional organization involvement, serving on key supplier advisory boards, becoming involved with entities pushing regulatory change, etc. Contributions of value with any of these will enhance both reputation and provide personal brand benefit .