Until now very little research has been carried out into the definition of the personality traits that make a great risk manager and whether their skills need to change to meet emerging challenges. We have surveyed risk managers from a wide range of industries and areas. The survey results showed that, though the majority of today’s risk managers have characteristics that conform to the stereotype, there are many more dimensions to risk managers than first thought.
The research itself was straightforward. We invited risk professionals from around the world to take part by completing an online confidential psychometric survey.
We based it on the well-established DISC profiling methodology, which classifies individuals on two axes—proactive/reactive and introvert/extrovert—and places people into one of the four resulting personality quadrants: proactive introverts, proactive extroverts, reactive introverts and reactive extroverts.
Over 1,000 risk managers sent back responses.
The traditional view of risk managers is that they must be analytical and cautious, numerate, precise and principled. They must show good judgment and be capable of collecting, recording and processing large amounts of data in a methodical way. Risk managers should be able to present risk data in the context of corporate governance, risk and compliance needs. Often they have been unkindly viewed as the “guys from the department of no,” who sat somewhat separately from the rest of the business.
The New Characteristics
The survey results showed that, though the majority of today’s risk managers have characteristics that conform to the stereotype, they have other characteristics, too.
It was apparent, even from the first batch of survey results, that 60% of risk managers had psychometric profiles that matched or incorporated the traditional characteristics associated with the role. This percentage stayed constant even as the sample size increased and became more diverse in terms of nationalities and industries.
The personality traits commonly associated with risk managers fall into the DISC methodology ‘Reactive Introvert’ category. Reactive introverts are viewed as experts, capable of demonstrating strong analytical skills and applying logic and caution to deal with often complex subjects where accuracy and precision are essential.
Lacking the ability to win people over to their viewpoint, could traditional risk managers be holding their companies back?
Most people are a blend of personality traits, and nearly one of every three survey respondents classified as reactive introverts also had proactive characteristics.
The remaining 40% of risk managers surveyed were proactive extroverts, evangelists, with natural communication and social skills and capable of using an endless supply of argument and charm until the task is achieved. Significantly, they are also prone to exaggeration.
A related type, proactive introverts, are hard-driving individuals determined to see a project brought to a successful conclusion. These drivers are demanding and do not take no for an answer. They sort issues on the fly and sometimes break the rules. As drivers, such people are needed to embed a risk culture and drive change through organizations.
Their skills will be needed increasingly as businesses become more risk mature and take an enterprise-wide view in addition to using the skills provided by the traditional risk manager “technician,” the reactive introvert.
So we see that there is room for a significantly greater variety of skills and personality types within the risk management function than has previously been acknowledged. Senior management has to be clear in what it is trying to achieve through the risk function and build an appropriate team to support this need.
What worked in the past may no longer be appropriate to meet future needs as the organization’s risk maturity increases.
As cultural change programs and communications become more important, “traditional” risk management skills will not be enough and a mixture of personalities may be needed. That could also lead to conflict and irritation among team members. Everyone on the team will have to work to be more self-aware and ensure that the unit acts as a cohesive team.
Peter Robertshaw is the senior vice president of corporate communications for Active Risk, a provider of enterprise risk management solutions based in Herndon, Va. He can be reached at firstname.lastname@example.org.