In simpler times, risk management mostly has to do with math, probability, and luck. Today, risk managers need a lot more skills to keep up with the continuous change of regulations and standards across multiple industries. And since risk management is now considered an integral part of business, particularly in financial services, there are many opportunities that one can take to become a risk manager.
However, being a successful risk manager requires more than just being good with numbers. Here are some of the most important skills that a risk management manager should possess:
1. Analytical skills
In many reliable ERM modules that you will come across, analysis is considered a fundamental step in risk management. A risk manager must have a good set of analytical skills in order to foresee possible issues and step in at the best possible time while maintaining a low level of personal bias. Similarly, a risk manager must have a keen eye for detail that will help him or her spot the smallest (and seemingly unimportant) things that should be considered to prevent a bigger mishap in the future.
2. Grace under pressure
Successful risk managers are those who are able to maintain grace under pressure, if not prosper despite it. While pressure and stress are very normal things in the industry, risk managers should know how to manage stressful situations, keep their cool, and maintain rationality at all times.
3. Fundamental understanding
Every risk manager should be adequately knowledgable about the industry he or she is working in, be it insurance, finance, or retail, among many others. At the very least, a risk manager should know the industry well enough and be able to determine potential risks, come up with appropriate mitigation strategies, and minimize similar dangers in the future.
4. Communication skills
Having good communication skills often goes hand in hand with being good at influencing people. And ask a risk manager, you should be able to convince and negotiate with people towards a particular idea or goal in a way that they can easily understand.
5. Presentation skills
A good risk manager should be able to present his or her findings clearly and concisely wherein risk concepts, practices, and strategies can be understood by everyone in the room.
A significant part of being a risk manager is making crucial decisions that no one else is too keen to make. That said, a good risk manager should be able to make decisions in a timely manner, especially at times when the stakes are high. However, this skill can only come inherently through experience, knowledge, and critical thinking, which may be gained in the first few legs of a risk management career.
If you’re interested in pursuing a risk management career, these are just some of the fundamental skills that you should have. Although it can be challenging to master all of these skills from the get-go, it is easier to do so through practice and experience with a company you trust.