Changing workplace risk culture

Edward Werner explains how the Equatex best practice approach includes changing workplace risk culture for the better.
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As a Senior Risk Manager at Equatex, Edward Werner has helped to establish how the company deals with operational risk in the workplace. Here, he explains how the Equatex best practice approach includes changing workplace risk culture for the better.

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Operational risk is all the stuff that happens that you didn’t plan or don’t want to happen. While some operational risks are due to natural disasters – like hurricanes – those things happen infrequently and can happen to anybody. However, in reality, people are the most common cause of operational risk in organisations, whether through malignancy, or some other kind of human flaw.

What we have done at Equatex is create a ‘risk process cockpit’ where every in-house process is centrally documented on an intranet page and the owner of that process is asked to certify its status once a quarter. If you have 12 people in a group – one of them will be the process owner. He or she will write up that process with the team step by step and test it thoroughly.

This approach creates 'risk professionals', who learn to talk about risk as if it is second nature to them.

These process owners have worked out well for Equatex, and give us confidence that our operational risk is low and tightly controlled. If your operational risk is high, then the company is in trouble. And as I’ve said, humans are the main factor. Now you can look at this in a negative way as people making errors, or you can do what we are doing here at Equatex and leverage the fact that most people want to show they are professionals and have their house in order – that’s how most people react if you give them the opportunity to show it.

Horses for courses

The line manager is going to pick his strongest horses to become process owners and is going to use his or her criteria for choosing people; the most stubborn; the sticklers for detail. The process owner has to have some drive, and has to be prepared to say: “I want it like this, or like that – go do it!” You really need people like that.

Edward Werner

Edward Werner, Senior Risk Manager at Equatex

And if the process owner is not right for a job, it is important that they should just own up to it and be encouraged to move on or give that process to someone else if they are the wrong choice. The US military has similar systems in place. You either have something under control or you don’t, and if you’re not the right one then you’d better speak up, because you own it. Colleagues really need to trust each other to make it all work, and become risk owners themselves. Since we have implemented process owners at Equatex, people have become really excited about it. When people’s processes are under control, they feel good about it.

I will still look at processes and check them over but if I can get someone to the point where I trust them when they say to me “my process is in order, it’s tight”, that’s fantastic. It’s not about saving budget on the risk side; it’s about becoming hugely scalable: if you have lots of people who are committed, innovative, and who can be trusted, and get people to just unfold and run at top speed, there’s no limit to what you can accomplish.

If you enable your employees to take on risk ownership in the same way we have done, you can increase your growth and acquisition prospects, save valuable time, and increase security against your competition.

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What is operational risk?

Operational risk is defined as the risk of loss resulting from human factors, system errors, natural events and employment practices. The nature of operational risk changes from industry to industry, although it is often summarised as human risk, so those industries with lower human interaction are likely to have lower operational risk.

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Equatex provides international employee and executive compensation plan services for today’s global enterprise, supporting clients with participants across Europe, Asia, Australia and America.

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