One of the benefits of not being an ERM pioneer is that you can glean from the knowledge and experience of those who have gone before you. Within the last few years, more companies have successfully implemented ERM and now offer insights into the best practices and pitfalls of the process. Below are common pitfalls discovered by companies that have already blazed a trail:
Implementing ERM without a framework and strategic plan
Lack of visible, active support from the CEO
Overselling ERM value for initial risk assessment
Risk identification confused with ERM
Treating ERM as project versus a long-term commitment
Becoming overwhelmed with initial risk assessment results
Lack of true integration with strategic planning, budgeting/forecasting, etc.
Failure to take risk management through full process
Failing to realize the need for change management
Lack of leadership and passion
By taking these ten pitfalls into consideration and studying how to avoid them, you can greatly increase your chances of success with ERM.