In this post, we discuss enterprise risk management as the ultimate success factor in a company’s business. We are trying to open so-called low-threshold approaches to how to reduce risks instead of just managing them.
We here at Granite believe that by orienting your operations along these lines, the results of systematic risk reduction are achievable and undeniable.
Realities of risk work
Quite many of the most common business support functions rarely receive the credit they deserve. In many cases, people consider them as a necessary but cumbersome exercise that directs the attention and resources away from actual business that produces measurable results. This even though everyone uniformly recognizes their necessity.
In reality, resources are always scarce. Stating this does not require a deep insight into the world of business. Unfortunately, the solutions and operating models that make up a large number of business support functions rest upon on the idea that resources needed for the company to evolve and develop, time, in particular, are unlimited. And this leads to a situation where the driving need for development is routinely neglected.
This happens much more often than we dare even to think, mainly because the development measures cannot be adequately integrated into the everyday activities of the organization. In these situations, the effectiveness of such measures is easily called into question.
Are we always thinking of risks?
Is the sole function of business to survive to fight another day? We do not think so. But when one narrows into the current state of the conversation about business in practice, it’s quite easy to come away with such a mental image. There is, of course, a lot of business talk nowadays about entrepreneurs and entrepreneurship, but much less about the keys to success.
Most of this can be explained away with the basic human condition. It’s always better to be safe than sorry. But that’s not very arousing.
This is not to be taken in any way as a belittlement of the everyday trials and tribulations that are part of the business, but on the other hand, it can be very harmful to overemphasis them also. In reality, they will manifest without further proclamations.
In many cases, the only actionable options are either an endless spiral of despair or total paralysis. And in the end, both options lead to the same situation.
There’s no viable shortcut away from the uncertainty of things, but there’s no need to make it any more difficult than it already is. Especially when it also opens up the most rewarding opportunities.
In such a situation the question is, what lays beyond the mere survival? Will all of the challenges and difficulties cease and be replaced by a selection of simple and easy choices to be made? Probably not.
We here at Granite have learned from experience that there are certain thresholds that need to be overcome for the change to actually take effect, and in short it can be said that it doesn’t evolve organically.
The modern business environment requires a lot more companies than before, but despite that, every journey begins with the first step.
Attitude does not solve everything but when it is channelled correctly, the results can be amazing. Continuing success is always built on solid foundations that produce effective actions almost as a by-product of measured and monitored processes.
More often than not, it’s the same worldview that declares inspiration as a sole cure for the unimpressive state of business as usual, that in fact causes this distorted view of the whole affair. It’s a curious and stimulating notion, but unfortunately also somewhat impractical. Not to mention successful.
Making room for success by reducing risk
Is the sole function of business to survive to fight another day? We do not think so. But when one narrows into the current state of the conversation about business in practice, it’s quite easy to come away with such a mental image. There is, of course, a lot of business talk nowadays about entrepreneurs and entrepreneurship, but much less about the keys to success.
Most of this can be explained away with the human condition. It’s always better to be safe than sorry. But that’s not very arousing.
This is not to belittle the everyday trials and tribulations that are part of the business, but on the other hand, it can be very harmful to overemphasis them also. In reality, they will manifest without further proclamations.
In many cases, the only actionable options are either an endless spiral of despair or total paralysis. And in the end, both choices lead to the same situation.
There’s no viable shortcut away from the uncertainty of things, but there’s no need to make it any more difficult than it already is. Especially when it also opens up the most rewarding opportunities.
In such a situation the question is, what lays beyond the mere survival? Will all of the challenges and difficulties cease and be replaced by a selection of simple and easy choices to be made? Probably not.
We here at Granite have learned from experience that certain thresholds need to be overcome for the change actually to take effect, and in short it can be said that it doesn’t evolve organically.
The modern business environment requires a lot more companies than before, but despite that, every journey begins with the first step.
Attitude does not solve everything, but when channelled correctly, the results can be amazing. Continuing success requires solid foundations that produce effective actions almost as a by-product of measured and monitored processes.
More often than not, it’s the same worldview that declares inspiration as a sole cure for the unimpressive state of business, as usual, that causes this distorted view of the whole affair. It’s a curious and stimulating notion, but unfortunately also somewhat impractical. Not to mention successful.
Risk reduction is a question of attitude
Discussions about business development tend to gravitate towards often unnecessary graveness even in informal situations, so it’s not without consequences to ponder upon the terminology used to communicate the benefits and possibilities of risk minimization.
If we are naturally able to understand the critical factors of risk work through the most mundane examples from our daily lives, shouldn’t it stand to reason that these principles could be utilized in other situations as well?
It is an often-declared notion that humans react best and learn most efficiently through stories. Taking a broader view of our culture quickly backs this notion up quite nicely. So, for the benefit of making risk minimization process more understandable and accessible, it might prove to be quite fruitful to test the risk minimization ideas and techniques in the context of well-known stories.
Risk reduction in the world of Lord of the rings
The Lord of the rings is a three-part series of fantasy books published originally between 1954 and 1955. The main story of these books centers around the discovery of a long-lost magical ring and the subsequent destroying of the said ring. This series of books is in many regards a penultimate cornerstone of fantasy literature, and it has amassed a devoted international fan base, and not the least because of the massively successful film adaptations, released between the years 2001 and 2003.
Many works popular fiction can quite easily be used to illustrate various ideas, the rather simple basic story structure of the lord of the rings simplified to the core just now is very applicable for our purposes.
Goals, results and the risk reduction
Without defined goals, there is no risk. The value of this simple truth is not lessened by one bit by the quick, and often sarcastic notion that the best way to minimize risk is to give up your goals altogether. In practice, risk and success are of course inseparable, and in most situations, there is no conceivable way not to try and accomplish set goals. No matter how risky they seem. So is the case within the story of Lord of the Rings as well. When the main character of the books, a hobbit called Frodo, suddenly learns that the ring he now has is, in fact, a powerful master ring of dark lord Sauron, his first thought is to hide the thing or give it away. And when taking in the consideration that in the fantasy world of Lord of the Rings, the ring ending up back in the hands of Sauron would amount to something akin to an apocalypse, these first thoughts are quite understandable.
Fortunately, Frodo has the use of his friend, Gandalf the wizard, who can easily be seen as some type of magical equivalent of a risk management manager. In the story of Lord of the Rings, Gandalf is the person who initiates the process even though the de facto goal of the operation, the destruction of the ring of power, is stated much later, after the fellowship of the ring is officially formed.
This is very similar to the way this process occurs in the real world. Rare is the projects that succeed according to the preconceived timetable.
The risk minimising process described in the Lord of the Rings is quite realistic in many other ways as well. People find it challenging to feel ownership over the project, responsibilities are unclear due to an overemphasis on speed and agility, the necessary groundwork is neglected, goals are under-defined, and their follow-up is random. Only consequences the risks are direr in the real world.
The right way to reduce risk?
There are a couple of viable and proper ways to kick off the traditional risk minimization process and fare few of them emphasize the need to sit down to ensure the common ground and goals. But as we see in the Lord of the Rings, getting everyone to attend can prove to be an arduous and thankless operation. Problems like this are bound to cause erosion in the resources reserved for the actual risk minimization. The sooner the process is started, the sooner it yields concrete results and room for success.
If the actual risk minimizing process is in its starting stages, it’s acceptable to allow oneself some leeway if one can still stay committed to the on-going nature of the risk minimization. The road to success is bound to bring up new, previously unforeseen, unexpected challenges and opportunities.
There’s no doubt that the fellowship of the ring could have utilized opportunities presented to them more efficiently if they had the right tools and services to do so. If you want to take advantage of the opportunities a guided risk minimization can provide, we here at Granite offer a formidable selection of easy to use and effective services to make that happen. For example, you can try Granite ERM -service free of charge by ordering free trial credentials.
Summary
In this post, we’ve discussed risk as a concept and the how the usual way of talking about business risks can make us somewhat blind to the possibilities proper risk minimization can bring about. Far too often the subject of risk is conversed in a frustratingly vague and ineffective frame of reference or simplified to extremes that it devalues the whole process. Effective risk minimization succeeds in a risk-aware environment that is not as difficult to establish as one might think. Some of the challenges can be overcome with a change in attitude, and the rest follow along quite pleasantly when utilizing proper tools and services.