Fundamentals of Risk Management

Risk practitioner competencies
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problems. The output from analytical skills is the ability to formulate appropriate 
alternative solutions and challenge the alternatives so as to develop the most logical 
plan of action.
Problem solving and decision making are important skills for business life. 
Problem solving often involves decision making and decision making is especially 
important for risk management. There are activities and techniques to improve
decision making and the quality of decisions. Decision making is more natural to 
certain personalities, so these people should focus more on improving the quality of 
their decisions. People who are less natural decision makers are often able to make 
quality assessments, but may need to be more decisive in acting upon the decisions 
made.
Problem solving and decision making are closely linked and each requires creativity 
in identifying and developing options. Brainstorming techniques are particularly useful 
and these will include SWOT and PESTLE analysis structures. Good decision making 
requires a mixture of skills, including creative development and identification of
options, clarity of judgement, firmness of decision and effectiveness of implementation.
Management skills
Although it is typical for risk management departments to be quite small, this is not 
always the case. In any event, even if the risk practitioner does not have direct man-
agement responsibilities, there is a need to understand management skills. Such skills 
may be relevant in relation to persuading other managers to take a different course 
of action. This awareness of management skills should extend to team management 
and delegation of authority.
Many of the people skills described in this section are also relevant as manage-
ment skills. Perhaps the most important of these people skills as a manager is that of 
motivation. Motivational skills are important for risk practitioners, especially where
a change in behaviour or a development of risk-aware culture is required. The risk 
practitioner will need to motivate individuals, managers and directors to behave
differently.
Also of considerable importance are self-management skills. These will include 
the ability to set appropriate priorities, meet necessary deadlines and maintain self-
motivation. Time management, organizational and self-motivation skills remain im-
portant for the risk practitioner throughout his or her working life.
Perhaps it is worth reflecting on the fact that there is a difference between man-
agement and leadership. An individual may be able to manage a department by
exercising tight control over the activities of individuals. This is not the same as the 
leader who has established a set of priorities and empowers members of the team to 
manage their own activities towards fulfilment of those priorities. Ideally, the leader 
will have ensured that the priorities have been developed in full consultation with 
the individuals responsible for delivering those priorities.

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