What risk management competencies do you need to look for in someone with a large element of risk management in their job profile? Whether that’s a technical risk management role, an enterprise risk manager or someone in the PMO leading on project risk, there are a number of competencies and skills for risk professionals that you can look out for.
Use these risk management competencies in your planning for resources, recruitment activity and as a way to assess your existing staff against your professional development framework.
1. Technical Risk Management
It goes without saying that people in risk management roles should have a good understanding of the technical aspects of risk management.
Technical risk management skills include:
- Analytical skills
- Data handling
- Research and information synthesis
- Modelling e.g. Monte Carlo analysis
- Schedule improvement and validation
- Quantitative and qualitative risk assessment
- Risk analysis
- Risk reporting including tornado charts, benefits analysis and confidence level histograms.
These are skills that can be delivered via risk management training if you do not already have them in-house. Not all roles will need all technical risk skills. A training needs assessment will help you identify who in the organization needs what skills. Then you can make a plan to ensure they are provided with adequate support in gaining the required skills.
2. Planning Risk Activities
Risk management doesn’t just happen. It needs to be planned, so individuals with risk responsibilities should be skilled at planning the work. This includes:
- Creating a risk management strategy
- Developing risk management policies
- Creating processes, procedures and protocols appropriate for supporting the strategy and policies
- Designing an organization structure that works for the enterprise, including roles and responsibilities for people involved in risk management
- Being able to build awareness of risk and create a positive risk culture
- Setting up risk governance structures to oversee the work
- Choosing the right risk management tools for the job.
A large part of risk management planning has to happen with support from executive management. It’s as important to get buy in for your plans as it is to have robust plans in the first place. Good interpersonal skills will help secure support for risk activities across the business – and we’ll come on to those a little later.
3. Measuring Risk Management Performance
Someone leading on risk management should be able to assess how successful the business is being in adequately managing risk. This includes:
- Knowing what risk management metrics to track
- Understanding risk reporting and how to best use this for communication
- Reviewing risk assessments
- Carrying out analysis and evaluations.
This can be done at project level, where the project manager assesses the success (or otherwise) of project risk responses, or at enterprise level, so the exact skills and competencies required will differ for different roles.
A risk management maturity assessment will help you understand where you are already strong in these areas and where you could develop the team and the processes further to better support the business.
4. Learning from Experience
A core skill for risk roles is being able to digest what happened, suggest changes and carry out plans for continuous process improvement. In fact, this is a useful skill for the vast majority of business roles!
Risk managers should be able to identify weaknesses in the existing policies or processes and adjust these going forward to make them fit for purpose. Regular reviews, listening to people using the processes, and improving based on learning and best practice, will ensure the organization continues to develop risk maturity.
Learning from experience also relates to understanding the outcome of risk events. Where a particular risk led to a specific outcome, that should be reviewed, assessed and understood. Then plans can be updated so that type of risk can be better managed in the future. It’s important to create a way to share this knowledge so that project managers are informed and can select the best risk response if they see a similar risk on a future project.
5. Soft Skills for Risk Managers
In addition to the more technical competencies mentioned above, risk managers need advanced soft skills too.
In practice, the ‘soft’ skills are often the hardest to get right and are difficult to teach, although you can improve your competence in this area through self-awareness, learning and practice.
A wide range of interpersonal skills are required for those in risk-related roles because the job involves working work people at all levels in the organization, across multiple departments. You will rely on subject matter experts for analysis and management actions. The people that are following up risk actions are unlikely to work for the risk manager, so it’s important to be able to influence those in a matrix structure so the work gets done.
Relevant interpersonal (‘soft’) skills for those in risk roles include:
- Communication: written, spoken and presentation skills as well as good listening
- Conflict management and resolution
- Networking and relationship building
- Time management
Of course, there are many more skills that people in risk management roles need, but the above competencies will give you a starting point for developing role profiles or including risk management responsibilities in the job descriptions of your existing staff.