Risk management is often seen as a routine obligation: recording and controlling risks to prevent disruptions. In an August expert conversation, Granite’s Teppo Kattilakoski and Janne Viljamaa highlighted that the true value only emerges when risk management is integrated into strategic planning. Strategic risk management is not an add-on process but a way to ensure that goals are achieved and opportunities identified ahead of the competition.
Viljamaa summed it up neatly: “The purpose of risk management is to ensure that objectives are met. If we only look one or two years ahead, we miss many essential changes. Strategic work requires a multi-year outlook, and then risks and opportunities appear in a very different light.”
Strategic risks should be familiar topics years before any actual decision needs to be made.
What is Strategic Risk Management?
Strategic risk management is about looking at risks and opportunities in the context of an organisation’s long-term goals. It differs from operational risk management in two key ways:
- Time horizon: operational risks are usually assessed one to two years ahead, while strategic risks extend three to five years or more.
- Approach: operational risks are often managed through detailed controls. Strategic risks, on the other hand, rely on monitoring, dialogue, and scenario building.
Kattilakoski described a challenge familiar to many practitioners: “For us, operational issues started to dominate. The strategic level was not given enough attention. It is easy to get caught up in daily risks, but much harder to pause and reflect on how changes in the environment affect our ability to reach our goals.”
This forward-looking perspective is what sets strategic risk management apart. Without it, organisations face two major risks: failure to achieve objectives (because the strategy cannot withstand unexpected changes), and missed opportunities (because early signals of change go unnoticed).
How to Integrate Risk Management into Strategy Work
Risk management only supports strategy if it runs throughout the entire process, from definition through execution and monitoring. This does not mean endless paperwork, but rather continuous dialogue.
In practice, integration begins with assessing uncertainties for each strategic objective. During the planning phase, a “sanity check” ensures that goals are realistic in light of identified risks and opportunities.
As Kattilakoski put it: “If a risk emerges during decision-making that was not anticipated, it is already too late. Strategic risks should be familiar topics years before any actual decision needs to be made.”
After that, the role of strategic risk management shifts to monitoring and discussion. Not every risk needs to be covered in every meeting. Focusing on one theme at a time often produces deeper insights and a shared understanding that strengthens decision-making.
Documenting risks and opportunities also brings transparency to leadership. Boards are no longer reliant on verbal assurances from the CEO but receive a fact-based view of which risks and opportunities have been identified, how they have been handled, and when they were last reviewed.
In short, risk management strengthens strategy only when it is present throughout the process:
- In strategy definition: assessing whether objectives are realistic given known risks and opportunities.
- In execution: embedding controls and priorities into strategic plans.
- In monitoring and decision-making: addressing key strategic risks in boards and leadership teams on a regular basis, often focusing on one theme at a time.
Tools and Practices for Handling Strategic Risks
The expert conversation introduced practical ways of making strategic risk management part of daily work. One approach is regular reviews that do not necessarily aim at immediate decisions but at maintaining visibility and ongoing dialogue. Long-term risks rarely require instant controls but they do require continuous attention.
Another key practice is actively identifying opportunities. In many organisations, risk registers list dozens of risks and only a single opportunity. Granite decided to try a different approach.
Kattilakoski explained: “When we adopted a strategic risk management model, we quickly saw opportunities coming to the forefront. Today, we use a 50-50 model where risks and opportunities are addressed in balance. This forces us to look at issues also from a positive angle.”
Technology also adds value. For example, requiring a choice between classifying something as a risk or an opportunity is simple but effective in steering discussion.
Artificial intelligence can also bring unexpected insights. As Viljamaa noted: “When we asked AI to propose risk indicators, it suggested things we would not have thought of ourselves, such as competitor product launches. It opened our eyes to view the operating environment from a fresh angle.”
Conclusion: Long-Term Work Creates Competitive Advantage
Strategic risk management is not something enforced by standards. No one requires organisations to identify strategic risks and opportunities. Those that do are genuinely looking for benefits. And the benefits are many: resilience, faster response to change, and, above all, better decision-making.
The key takeaways from the expert conversation can be summarised in three points:
- Strategic risks and opportunities must be identified well before decisions are made.
- Monitoring and dialogue are just as important as control measures.
- Risks should be considered alongside opportunities.
Through strategic risk management, organisations can safeguard their objectives, make smarter choices, and build sustainable competitive advantage. Explore our Strategic Risk and Opportunity Management tool.