5 Ways to Identify & Prepare for Emerging Risks

In the last twenty years, the unexpected has become commonplace in risk management. So how do we plan for what’s next? This session at the RIMS 2019 Annual Conference & Exhibition examined strategies to identify and plan for emerging risks.

Speakers included:

• Chris Mandel, Senior Vice President & Director, Sedgwick Institute
• Jeff Mycroft, Vice President of Risk, Express Employment Professionals International Headquarters
• Rob Quast, Director of Insurance & Claims, Kroger

Emerging risks are issues that have not manifested themselves sufficiently to be managed using the tools commonly applied to more-developed exposures. In fact, oftentimes emerging risks are so new that there is not insurance established yet to cover them. They are typically low frequency, but high impact. No matter how unlikely, unpredictable and difficult, they are risks we cannot ignore.

Key emerging risk strategies can include:

• Planning for the unexpected
• Understanding the impact of the sharing economy on the workforce
• Adapting to generational changes
• Advancing digital workplace

Five strategies to identify and prepare for emerging risks include:

1. Conduct emerging risk reviews. Survey and ask what keeps people up at night. You may find very different answers from different areas of your organization.
2. Integrate or align reviews with the organizational planning process. This does not necessarily have to be a separate process, but rather of key element of the overall process.
3. Challenge the conventional thought process and status quo. The risk manager should be included in conversations as the business changes to help identify risks accordingly. Emerging risks may require you to change your operations and corporate philosophy.
4. Apply the right methods to better understand and predict. Measure, collect data and know what to do with that data once you have it.
5. Drive agreement on key assumptions and test them with rigor. Your success depends on the ability to react and be nimble, which stems from preparedness.