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Business Risk and Strategy: Top Tips for Maximizing Success in Today's Turbulent Times

Ben Stevens, the founder of Flipview, shares his top tips on making strategy (and risk) meaningful and effective for organisations.

Defining what strategy is can often be difficult. There is no one size fits all definition or approach. All organisations are unique. Sometimes it is easier to describe what strategy is not, and provide some good tips, to help bring strategy to life.

Turbulent Times

We live in increasingly turbulent times. Futurists, so called “experts”, and economists are often more notorious for getting things wrong than getting them right. Formulating strategy often involves a degree of forecasting into the future, and recent events show that the days of 5 years plans or strategies are dead. Energy is consumed building the plan, and by the time the plan is complete it is obsolete and BAU takes over. The impacts of disruption continue to be underestimated. Technology and disruption will continue to put pressure on traditional business models. If a 1971 VW beetle increased in performance like a microchip, it would travel at approximately 2.4 million miles per hour today. What are the big technological/sociodemographic shifts technological shifts that might impact on your business model? What might you leverage?

The Relationship between Risk and Strategy

Strategy needs to not just map out potential obstacles and risks but also leverage those. If the strategy doesn’t map these out, it is likely that your strategy is more of a wish list of things you “hope” will happen. Anticipating things that might go wrong will help firm the mapping of the strategy. If your strategy doesn’t involve at least taking some risks, it is likely that is more of the status quo (which is fine of course if you are a government funded monopoly). As above with strategy taking consideration of risk, risk also needs to take consideration of strategy. What are the big risks to your strategy? Where might execution fall down? If this isn’t done, it is likely that your risk register is really a compliance register.

Risk Registers

The risk register has become the penultimate “deliverable” replete with heat maps to provide comfort and traffic light symbols. While these tools are useful for analysis and discussion, what is more important is action and validation. Rather than reporting on risks each quarter, why not report on what is actually happening to not just contain risks, but also what risks are being embraced to move the organisation forward? Related to the above, some people love spending hours pontificating of whether something should be red, amber, or green. Who cares, as above, get on with the job of actually doing the hard mahi of either managing or taking advantage of risk.

Engagement

Engagement is key. The traditional approach of the ivory tower cascading the strategy down the organisation without structured input and involvement from those at the coal face has shown to be ineffective time and time again. An open and collaborative approach to strategy regardless of systems and tools deployed will significantly increase the chances of success. Engagement is also key when it comes to risk. Is there someone on the factory floor that day after day is seeing the pending train smash, and they don’t have a way of really sharing this intel? It is impossible to forecast and know all the risks that might crystalise for an organisation, however, ensuring staff are engaged and communicate is key. This will also ensure ownership and accountability. Perhaps don’t use the word strategy and risk. Replace it with plans and obstacles.

Resourcing

Resourcing is also key. If your head of strategy is a former marketer, you will have a marketing strategy. If your head of risk has a background in H&S or Cyber, these will dominate. Try to resource these functions with people that have a broad foundation and have high EQ to engage the organisation.

Track Progress

How are you tracking the implementation of strategy? Are there links between the strategy pillars, priorities, and key projects? Are you tracking key milestones? Are non-financial metrics being used to help ensure that the strategy is on track (KPIs/OKRs). If these are not being used, or if the financials are representative of those markers, by the time the financials are done, it is likely that the horse has already bolted.



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