Controls to assist us managing risk have been around for thousands of years. Why – because risk has been around since the beginning of time. Our human instinct for survival has by necessity meant that we have had to try and control our environment and the risk contained therein.
Then the industrial revolution took the need for control to a new level as we placed large groups of workers together and added in a good dose of dangerous machinery and processes. As a result, we have grown to accept controls as an everyday part of our business lives. See an example of controls being implemented in our article Risk Management Controls in Tough Mudder.
However, have we become too complacent? Many staff responsible for controls in organistions are often not even aware that what they do is a control! If they are, they often have little knowledge of why they perform the control other than “I have been told to”! Read the article Risk and Controls-Who owns them?
What does this mean for us in 2016 and beyond? It means that we can add serious value to our businesses simply by getting back in touch with our controls, understanding them better and understanding how they relate to the various risks we face on a day to day basis.
Is it time for you to get intimate and back in touch with your controls?
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The Importance of Controls in Risk Management.
Author of 'A Short Guide to Operational Risk', David Tattam is an internationally recognised specialist in all facets of risk management, particularly at the enterprise level. His career includes many years working with PwC, as well as two Australian banks. His achievements include the creation of the Middle Office (Risk Management Department) for The Industrial Bank of Japan in Australia and the complete implementation of all Australian operations, systems, procedures and controls for Westdeutsche Landesbank (WestLB).