The value of risk management: demonstrating your impact

As we established in our first article, proportionality is a hallmark of mature risk management. This means focusing your resources on significant risks while maintaining lighter oversight of minor issues. By demonstrating this balanced approach, you show the business that risk management is not about controlling everything, it is about controlling what matters most. 

While traditional risk management focuses on learning from failures, we often overlook an equally valuable source of insight: our successes. In our eighth article, we introduced the concept of a “positive bow tie” - applying root cause analysis to understand why things went exceptionally well, not just why they failed. 

When you analyse cases where tight deadlines were met, system transitions were flawless, or customer satisfaction exceeded expectations, you identify the positive risk drivers that enable success. These insights can then be systematically applied across your organisation, improving performance while building positive associations with risk management practices.

Perhaps the most powerful way to position risk management positively is to frame it as a performance stabilizer and enabler rather than a constraint. Effective risk management creates the conditions for consistent, predictable performance that enables your organisation to pursue ambitious goals with confidence. By positioning risk management as a condition for ambition rather than a constraint on it, you fundamentally change how it is perceived and valued within your organisation. 

Finding the optimal balance

Risk management comes with a cost, this is undeniable. It requires a lot of resources and various frameworks. The critical question is whether these investments provide more value than they cost. 

The iceberg model highlights that control decisions have hidden impacts in both directions: 

• Over-controlling limits your organisation’s agility, reduces transaction volume and can discourage innovation. While you might avoid certain risks, you also limit your potential for growth and success. 
• Under-controlling might initially create a faster, lighter organisation, but it typically leads to recurring avoidable mistakes that damage your performance and reputation. Additionally, it might create exposure to large, disastrous events that could sink the business entirely.

Building credibility through balance

As a risk management professional, your credibility with the business - and consequently, the perceived value of your function - depends significantly on your ability to recognise when controls should be reduced, instead of increased.  

When you can acknowledge areas where excessive controls are hindering performance and recommend appropriate adjustments, you demonstrate a true understanding of business needs. This balanced approach of developing proportionate risk management builds trust with business leaders. In time, they will become more receptive to your guidance in areas where stronger controls are genuinely needed. 

The invisible framework: speaking the language of business

One of the most powerful ways to increase the acceptance and perceived value of risk management is what we call “the invisible framework.” This means separating the technical risk management structure - the frameworks, taxonomies, and methodologies - from how you communicate with the business. 

While risk specialists need these technical elements to ensure comprehensive coverage and consistent approaches, business leaders and staff don’t necessarily need to understand these details. Instead, focus on translating risk concepts into business language that resonates with their everyday challenges and objectives. This means: 

• Using business terminology rather than risk jargon 
• Focusing discussions on business problems rather than risk frameworks 
• Adapting to existing business practices rather than imposing new ones 
• Recycling existing metrics and processes where possible 
• Demonstrating how risk management solves business problems 

This approach doesn’t diminish the importance of technical risk management elements, it simply recognises that their value lies in the outcomes they enable, not in their technical sophistication. By making the framework “invisible”, you ensure that business leaders focus on the benefits rather than the mechanics. 

Building relationships and communities

Beyond technical skills, effective risk management requires strong relationship skills. As a risk professional, your ability to build trust and credibility directly impacts how receptive others will be to your guidance. Remember that if people don’t respect you as a competent professional, they will likely exclude you from key conversations - which itself becomes a significant risk to your organisation. 

One powerful approach to building this relational dimension is creating communities of risk champions across your organisation. These communities allow for: 

• Sharing practices and experiences 
• Collectively addressing common challenges 
• Building a supportive network 
• Creating a sense of shared purpose 
• Continuously improving approaches 

Such communities transform risk management from an isolated function to a collaborative effort that draws on diverse perspectives and expertise. This not only improves the quality of risk management but also significantly enhances its acceptance and perceived value throughout your organisation. 

As we conclude our Risk Blueprint series, remember that effective risk management is ultimately about enabling your organisation to pursue its objectives with confidence.

The methods and approaches we shared throughout this series provide a comprehensive roadmap for maturing your risk management capabilities. By implementing these approaches in a way that aligns with your organisation’s specific needs and culture, you create a risk management system that truly deserves the description: “good risk management is good management”.