Go hard or go soft: what’s best to succeed as a risk manager?

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Go hard or go soft: what’s best to succeed as a risk manager?

Almost every industry has a set of skills that they would attribute to success. The rapid changes in the everyday business environment, new market players, the need for flexibility and changing toolsets means that people are increasingly having to adapt their skills to include social and emotional factors. Yet in popular culture, there’s an unspoken agreement that successful people just aren’t that nice, with a stereotype that selfish and combative people usually are the ones that triumph.  In other words, it’s the tough guys who win in the game of life and corporate progress.  Being nice, listening, taking into account other peoples’ views is the simplest way to diminish your own force. 

Personal qualities as the driving force

As a strategic activity, risk managers are expected to excel in the design, implementation and reporting of risk management solutions and processes. Problem-solving and analytical skills, quantification and forecasting abilities are key to doing this job well. So what is the role of soft skills and deft human interaction, when it comes to being an effective risk manager trying to make a career – and maybe a name – for yourself?

Personal qualities associated with team leadership and influencing people are traits linked to longer-term growth potential and success but if they don’t come naturally to us, can be hard to change and develop. Anyone interested in developing this side of their professional life is likely to face a long struggle, peppered with disappointments and sometimes conflicts. It’s a hard path to travel. However, being seen to have courage or backbone, self-belief and determination to prevail are characteristics that can be quickly seen and identified. You only have to be right on one issue but if you do it loud and proud, you could well mark yourself out as being a formidable leader earning the right to challenge others and making tough choices where others are scared to speak out.

Risk managers are called upon to be involved in the process of making hard judgement calls in an organisation. If you can be seen to be getting people to agree with your views, this could be a powerful catalyst to your career. There are many ways to get people to go in the direction you think best: withholding information, being combative, manipulating discussions to shape stakeholder groups, isolating individuals who hold contrary views. Being nice takes too much time and could be framed as being weak, unprofessional or having low standards.

Extreme dominance might not be the way to go

However, even though dominant behaviour has the potential of getting you ahead, studies such as the one carried out by Cameron Anderson and colleagues at the Berkeley Haas School of Business, found that paired with selfish, critical and combative attitudes it could become a deterrent for success. 

When relying on courage and asserting your dominance you have to make sure that your communication skills are also up to scratch. Effective communication skills will allow everyone in the organisation to understand any significant risk reported and the proposed strategies. Knowing how to communicate with audiences that may have varying levels of understanding of risk management, will help ensure that your organisation receives actionable signals. But if your audience perceives critical and aggressive messaging you might not change the behaviours of your colleagues and could potentially create resistance or passivity to risk. In effect, people refuse to partner with you and take meaningful ownership of risks you have defined. 

Also, whilst courage is often gained through experience, senior risk leaders suggest that culture also plays a major role in “encouraging courage.” Leaders who actively seek out and welcome challenge and who positively reward people for speaking out on a regular basis develop a stronger channel of courageous future risk leaders beneath them. A good risk leader creates an environment where it is OK to be wrong about something but it is never acceptable to be incapable of learning how to be more right in the future.

Risk managers also need to be good with people because they are rarely given large doses of corporate power to support their mission

Understanding people and the way they function

Risk managers also need to be good with people because they are rarely given large doses of corporate power to support their mission, so being able to nurture goodwill and creating a sense of shared objectives are key steps in creating a coalition of allies. This involves understanding and working well with a diverse range of individuals, showing a healthy dose of humility and being able to read political dynamics in the workplace. While risk leaders are often called on to challenge and push back, they also need to balance this with tact and diplomatic skill. Without this, they risk being perceived as too abrasive, which can isolate them from their co-workers. 

Emotional intelligence factors such as self-awareness, self-regulation, internal motivation, empathy with others’ feelings, are vital for higher job satisfaction and increased job performance. 

The Evidence is in 

The age-old question of whether being aggressively Machiavellian helps people get ahead has long interested Anderson, who studies social status. It’s a critical question for managers because ample research has shown that jerks in positions of power are abusive, prioritize their own self-interest, create corrupt cultures, and ultimately cause their organisations to fail. They also serve as toxic role models for society at large.

While there’s clearly no shortage of jerks in power, Anderson and his co-authors set out to create empirical data to settle the question of whether being disagreeable actually helped them get there, or is simply incidental to their success. Using the “Big Five” (OCEAN model) of personality they defined terms and tests to see if it were true that disagreeable people were more likely to get ahead than their peers and if not, why not.

The research paper informs us that “Disagreeableness is a relatively stable aspect of personality that involves the tendency to behave in quarrelsome, cold, callous, and selfish ways. Disagreeable people tend to be hostile and abusive to others, deceive and manipulate others for their own gain, and ignore others’ concerns or welfare.”

As for the findings, it seems that the so-called jerks get into power at the same rate as everyone else, but there is no evidence that it sustains a career advantage. In fact, these people are more likely to be isolated when their judgements are incorrect and to suffer consequences for it. Their dominant behaviour is almost always nullified by failing to take into consideration the needs of the group.

The lesson for risk managers: we need to be at the forefront of disarming heroic personality judgement calls based upon the intuition, power and personality of a single person’s perception. Excellent risk management sustains an organisation by constructing ways to consistently make the best decisions taking into account all factors and feeding them to groups of appropriately experienced decision-makers. Risk is an inherently social proposition and requires people to develop outstanding social skills, not refining the ability to use power to close down alternative points of view.

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