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Risk Management or Risk Leadership?

Dr David Hillson FIRM, HonFAPM, PMI Fellow

United Kingdom


Risk management is an important contributor to project and business success. The past few decades have seen growing consensus on the elements required to manage risk effectively, including an efficient and scaleable risk process that can be tailored to the particular risky situation, an appropriate level of infrastructure to support the risk process, and skilled and competent people who know what to do and how to do it.

However risk management is much more than tools and techniques, processes and systems. One major contributor to effective risk management is a risk-aware supportive culture. But this seems to be the one factor most often missing in major organisations and businesses, leading to an inability to deal properly with risk.

Why do we find it hard to develop the right culture needed to support management of risk? At least part of the answer may lie in a change of perspective, away from risk management and towards risk leadership.

The distinction between management and leadership was first made in the middle of the last century, when businesses were seeking ways to improve organisational effectiveness. What’s the difference?

  • Management is the tactical ability to get things done, usually through other people, by setting appropriate targets, defining clear goals, tasking and motivating people, monitoring progress and making necessary adjustments to stay on track.

 

  • Leadership by contrast is a strategic competence, providing vision and purpose, setting overall direction, inspiring people to commit themselves to a course of action. Managers have staff, but leaders have followers.

When dealing with risk in our businesses and projects, have we focused exclusively on the tactical tools and techniques of risk management, and forgotten to exercise risk leadership at a more strategic level?

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About the Author

Dr. David Hillson

Author

Dr David Hillson CMgr FRSA FIRM FCMI HonFAPM PMI-Fellow is The Risk Doctor (www.risk-doctor.com).  As an international risk consultant, David is recognised as a leading thinker and expert practitioner in risk management. He consults, writes and speaks widely on the topic and he has made several innovative contributions to the field. David’s motto is “Understand profoundly so you can explain simply”, ensuring that his work represents both sound thinking and practical application.

David Hillson has over 25 years’ experience in risk consulting and he has worked in more than 40 countries, providing support to clients in every major industry sector, including construction, mining, telecommunications, pharmaceutical, financial services, transport, fast-moving consumer goods, energy, IT, defence and government. David’s input includes strategic direction to organisations facing major risk challenges, as well as tactical advice on achieving value and competitive advantage from effectively managing risk.

David’s contributions to the risk discipline over many years have been recognised by a range of awards, including “Risk Personality of the Year” in 2010-11. He received both the PMI Fellow award and the PMI Distinguished Contribution Award from the Project Management Institute (PMI®) for his work in developing risk management. He is also an Honorary Fellow of the UK Association for Project Management (APM), where he has actively led risk developments for nearly 20 years.  David Hillson is an active Fellow of the Institute of Risk Management (IRM), and he was elected a Fellow of the Royal Society of Arts (RSA) to contribute to its Risk Commission. He is also a Chartered Fellow of the Chartered Management Institute (CMI) and a Member of the Institute of Directors (IOD).

Dr Hillson can be contacted at [email protected].