Your Playbook for Making Risk Management a Way of Life

Banks, of course, are in the money business. But banks are also in the change management business.

Whether facing internally or externally driven demands, banks are constantly implementing, revising, and expanding processes to introduce new customer offerings or abide with regulatory requirements. And each tweak you make – even something you think is so tiny and inconsequential – opens the door for some level of risk.

Spinnaker’s recent whitepaper, Turning a Solid Risk Management Framework into a Competitive Advantage: How increasing resiliency and adaptability can help differentiate your bank, underscores how forward-looking organizations invest the time, money and resources into driving and promoting a risk-aware culture. When you look at this as a strategic move, you exit with a repeatable framework for navigating swiftly, efficiently and decisively through any change; everyone in your organization is on the same page and striving to the same goal: consistency in how you approach risk-based decision-making that follows the rules and serves customers’ best interests.

Having a vision for a risk management framework requires tactical direction to make it a living, breathing part of your culture. We’re here to walk you through the key steps to embed meaningful change management capabilities into your organization.

Promoting a Risk-Aware Culture

We’ll be completely transparent: Pushing an entire organization to pivot its mindset and plant a stake that puts risk management front and center can be a tough sell. At the same time, it should be the highest priority for your senior leaders. When you promote a culture that recognizes and mitigates risk in every single action – beyond our focus right now just on change – you are turning an ordinary part of doing business into something extraordinary.

How so? A risk-aware culture is more than just part of your enterprise DNA; it’s your competitive advantage as you go to market faster than your peers or integrate (and comply with) new regulations ahead of agency deadlines. Consider these key steps that will get you started:

• Apply Risk Framework to Prepare for Constant Change: You’re building a repeatable, consistent change management process that minimizes risk, whether you’re launching a product or adapting to new regulatory guidance. Focus your energy on compiling the resources you need, developing end-state practices for how you do the work and oversee it, and having open lines of communications among your three lines of defense.
• Develop a Shared Plan and Vision: You can work optimally when everyone is on the same page, which extends from establishing timelines to documenting processes, from setting performance markers to defining clear roles, which is essential for accountability. Most importantly, you’re setting up a two-way street between the business and your risk teams, reinforcing open communication on every change management project that comes through.

• Implement a Risk Plan Tailored to Your Enterprise: Banks aren’t one-size-fits-all; neither is change. Take into account your company’s risk appetite and tolerance as you carry out your change management work. As you near the finish line with new customer offerings or process updates to comply with regulatory requirements, be sure to involve your front line – people in your branches and contact centers, in particular – on the changes and what they mean to their daily work.

• Embed the Changes in Your Daily Work: Make it part of your people’s ongoing role and drive enhanced interactions between your different lines of defense. Each group walks away with clearer line of sight to peers’ core responsibilities and what matters most to them. When the next change comes along, you’re ready to hit the “go” button and use an established blueprint. The biggest gain is you overcome the habit of always hitting the “re-set” button, which costs you time and money as you land back at ground zero each time.

• Review, Review, Review: The project might be completed, but the work is never done. An effective process comes with routine monitoring. You need to keep an eye on its performance – and provide senior leaders with robust reporting both to validate success and identify future opportunities. Don’t rush this stage, as that only generates residual risk.

 Change is hard. Changing how you manage change is even harder. That’s why we’ve developed a playbook to make this process easier and will support better implementation. We walk you through every stage, outlining best practices and flagging potential pitfalls to avoid. 

How to Build a Tailored Risk Management Framework

Every organization approaches risk differently, from assigning a tolerance level to determining how to escalate issues. Because of that, you can’t expect a universal risk framework to fit every organization.

Based on our experience across all three lines of defense in the banking industry, we have seen firsthand how making this a priority will elevate your organization. A good place to get started is by downloading your copy of Making Risk Management a Way of Life: How to build a risk-aware culture that enhances your business. We’re here to guide you on how to turn your risk management approach into an integral part of your business strategy.