Page 80 - IRMSA Risk Report 2020

The view of the Executive function may well suggest that responsibility for strategic vs operational risk management lies
with the C-suite and operations respectively (and that the role of the risk management function is to shape this). Experts
tend to relate to organisations as complicated systems rather than complex adaptive systems; this seems to be supported
by the low number of responses suggesting that risk management was the responsibility of “everyone”.

EXECUTIVE RISK REL ATED SPECIALIST
BO ARD E XC O BO ARD EX C O BO ARD EX C O

E VER Y ONE RM FUNC TION E VER Y ONE RM FUNC TION E VER Y ONE RM FUNC TION

HO W WAS THE R ISK HA NDLED : USING FORM A L PR O CESSE S
AND C ONCEPT S OR GUT FEEL AND INTUITION ?

Regarding how situations were handled, 54% of respondents said that formal risk management concepts and processes
were used. Risk-related professionals favoured formal risk management more than gut feel and intuition, whilst Executives
were split half-and-half between formal processes and gut feel and intuition. This suggests the need for a deeper discussion
between the C-suite and the risk function on how risk is managed to query mental models. Gut feel and intuition play an
important role in real-time decision making; overly rigid processes give rise to less agile organisations.

The landscape below explores factors extracted from the stories related to the use of formal risk management processes
and concepts (or not). Here the contour lines represent where stories are clustered. Snippets illustrate the kind of stories
that underly particular parts of the landscape.

RISK MANAGEMENT LANDSC APE

HANDLED
SITUATION
USING

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