We need to take risk management back to the shop floor

Sitting in our ivory towers, we are ill prepared to deal with the risks that our companies face. 

I find irritating when I hear executives say that risk management is becoming a board issue. It has always been an issue for the C-suite. But equally, it is - and always has been - an issue for those on the shop floor too.

The idea that risk management was ever just the job of the risk manager is madness. The question is: How do we make every employee feel responsible for risk management?

A good risk team needs to be very connected, very good communicators and have a certain ability also to sell the message.

And we shouldn’t just be selling that message to the C-suite. We need to sell it to people on the plant floor, in the corridors and working on our network infrastructure.

We need to make everyone care about risk management as much as we do.

To do that they need to be empowered - as we are. Why do we feel empowered? We can affect change. So, to encourage every person to act as a risk manager, we need to show them that they can affect change too.

I recently conducted a study. I asked managers how they believed that employees of the shop floor thought about risk. They told me: “Security and safety are the number one values here, because we operate highly dangerous infrastructure, and we can’t allow that people die because of that infrastructure.”

But when you ask the people whose lives are potentially on the line, working on the factory floor, they tell you a different story.

“Well of course we hear the CEO’s message,” they say referring to the official line, which listed safety as the number one priority.

“But,” they say, “on the other hand, we have deadlines and we have budgets and stuff like that.”

“So we sometimes have to make shortcuts, and these shortcuts, they bear a higher risk on the safety end,” they explain.

When I reported back to the board, they were alarmed. They could not believe that their laser-like focus on safety was being disregarded in some cases to enable employees to meet targets.

The reason that was happening and why the C-suite were so shocked about it? A disconnect between the board and the people who ultimately reported to them.

The secret in that case was to put the C-suite in touch with those on the shop floor so that they could drill home the message.

Workers needed to know that “safety first” was more than just a slogan. It went to the heart of our risk management philosophy that informed every major corporate decision.

The way to reinforce that was to explain to workers that safety came before deadlines. But that dialogue was a two-way one. The board also asked to be informed of any deadlines that had forced workers to take unnecessary risks.

They then worked to make sure that never happened again, showing that everyone can be a risk manager by affecting change.