How can Social Media Take Risk Management to the Next Level ...

Risk Management remains one of the top 10 commitments and responsibilities of the C-Suite. ?Flowing from Risk Management is the need for well-thought-out business continuity plans.

How are organizations doing when developing these plans? And how can social media take risk management to the next level?

The status of the industry is laid out in Marsh?s 2012 Excellence in Risk Management IX: Bridging the Gap and it raises some interesting points. ??Both the C-Suite and Risk Managers see room for improvement. ?While the development of one?s Risk Management strategic process is an internal initiative, there are many ways that the C-Suite can support its development and evolution through the use of social media.

One finding in Marsh?s report clearly indicates that the C-Suite want managers to better understand what is happening in their industry as well as being knowledgeable about business operations. ?Leveraging social media working groups, whether through LinkedIn or other collaboration channels such as Chatter or Google Docs, Risk Managers can share information and collaborate on key issues surrounding the industry, the profession and strategies. ?Being able to collaborate with one?s peers and learn from others can be an invaluable tool for every organization.

A second area of concern raised in the report relates to crisis communications. ?Marsh?s study shows that crisis communications is the second-most important area that Risk Managers should review based on lessons learned after some of the catastrophic events of 2011, including the Japanese earthquake and subsequent tsunami.

The report quotes a vice president of Legal, Risk and Security of a public technology firm as saying: ?The obvious value is cost savings from avoiding or reducing potential claims. Less tangible, but equally if not more valuable, is reducing the potential for negative publicity and loss of client trust that could result from a failure of governance and oversight.? ?Referring back to a previous post, ?Reputation Management, the #1 Reason the C-Suite Needs to Listen to Social Media,? we know that this is serious business.

Based on these issues, ensuring the proper and effective use of social media for leveraging industry knowledge, executing crisis communications and reputation management, as a part of business continuity, is critical. ?It not only provides a fast and efficient method to reach large masses, it can also be a very effective way to engage with stakeholders and customers, while correcting misinformation as it happens.

Regardless of the size of your organization, when reviewing your risk management strategy and developing your business continuity plans, excluding social could result in serious ramifications. ?Knowing how to listen, engage and leverage community is no longer a nicety. ?It is essential. ?The Cost of Ignoring (COI) social is too great. ?How have your Risk Managers implemented social in their plans?

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Tags: business continuity, crisis communications, marsh, risk, risk management, risk manager

Source: http://www.radian6.com/blog/2012/08/how-can-social-media-take-risk-management-to-the-next-level/

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