Yet a recent survey by global consulting firm Accenture that ‘risk management” is a skill set sorely lacking at the executive level across the entire business spectrum in our nation – not just in transportation – and that perhaps presents a significant risk factor all on its own.
Indeed, Accenture found that while nearly all organizations (98%) consider risk management more important than it was two years ago, finding the right talent is a challenge, with 54% of organizations reporting a shortage of candidates with the right skills, according to firm’s most recent 2013 Global Risk Management study.
Based on a global survey of 446 executives across seven industries and two government sectors, Accenture also noted that exactly half of responding executives said their risk management functions were challenged by weak recruiting strategies and insufficient training programs. Now THERE is a scary thought indeed!
“Risk management is being pushed up the list of organizational priorities by external factors, from the political upheavals in Egypt and Syria, to the supply chain issues triggered by natural disasters, to Dodd Frank and Basel III regulations, as well as ongoing volatility in customer and financial markets,” explained Steve Culp, (seen at left), global managing director of Accenture’s risk management division, in this report.
“While these factors have led to increased internal demand and greater integration of risk management into decision making, talent shortcomings are hindering organizations’ ability to successfully execute and mitigate the risks to achieving business objectives,” he added.
As a consequence of the talent shortages, Accenture’s study also found large gaps between senior management expectations for risk mitigation outcomes and their risk function’s performance.
For example, 95% identified the importance of reputation management, but only 28% said their risk team had provided support in that area. Meanwhile, managing volatility was considered important by 70% of respondents, but only 21% said the risk team contributed to such initiatives.
The consulting firm’s research also discerned that organizations need to deal with talent shortages at a time when they are facing increased risks, with legal risks (named by 62% of respondents), business risks related to changing volumes and margins or demand (52%) plus regulatory requirements (49%) projected to rise most in the next two years.
And although 58 percent of the respondents said that they had grown their risk management team over the last two years, those executives participating in Accenture’s poll reported shortages of talent in a number of areas, including risk business and data analytics (61%), risk technologists (60%), and regulatory change program management (58%). Shortages of pricing and risk quantitative skills (46%) and risk operations specialists (41%) were also issues, Accenture found.
On top of all this Accenture also discovered that 50% of those responding said they lack skilled staff to develop analytical models, with 44% reporting difficulty embedding risk analytics in management processes, Furthermore, 44% say they are working with outdated legacy systems, while 42% said their systems integration is lacking.
“We are concerned that many organizations appear to be particularly struck by analytics skills shortages in the risk management area,” noted Culp. “Technology plays a critical enabling role but highly qualified talent is needed to ensure the successful application of these tools to improve risk management capabilities. Those who excel tend to nurture a range of analytics skills that are specialized in the various aspects of risk management.”
Something to think about at least as the business world continues to be an ever-riskier place to operate.
