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28 February 2024 ·

Is your strategic risk management a speed breaker or a roadblock?



Too often we see the risk management as a hindrance to growth initiatives, creating discomfort and reluctance. People may fear that risk management teams might impede business plans and derail their strategies.  But risk management is not a barrier.  It’s a breaker that enables your organization to decelerate, assess risks, formulate mitigation strategies, weigh the pros and cons; then accelerate faster. The breaker ensures a careful pause for making a strategic approach to navigating risks before proceeding with greater momentum.

This article delves into the potential for risk management to drive transformation, illuminating the capacity of risk management to fuel innovation and strategic growth.

Navigate uncertainties

The fluid nature of risks ranges from market fluctuations to operational intricacies. Adept leaders perceive risks as opportunities to refine and develop. Embracing risk inevitability allows organizations to transform challenges into catalysts for positive change.

Make strategic decisions

Integrating risk management into strategic decision-making processes provides organizations with a competitive edge. Identifying potential risks in advance empowers leaders to make informed decisions that mitigate negative impacts and exploit emerging opportunities. This is how risk management becomes a strategic breaker, guiding organizations towards resilience and adaptability.

As seasoned risk professionals with decades of industry experience, we have witnessed firsthand how integrating risk management into strategic decision-making processes significantly benefits firms. By identifying potential risks in advance, leaders can make informed decisions that not only mitigate negative impacts but also capitalize on emerging opportunities, giving their organizations a competitive edge. This proactive approach to risk management serves as a strategic breaker, guiding firms towards resilience and adaptability in an ever-changing business landscape.

In product lifecycle management, effective risk management practices are crucial for navigating the complex journey from inception to maturity. By consistently identifying and mitigating risks associated with regulatory changes, market fluctuations, and technological advancements, organizations can ensure their products uphold compliance and competitiveness over time. This proactive risk management approach enables firms to prolong the viability and profitability of their products, ultimately contributing to their long-term success.

Ensure ongoing monitoring and adaptation

Establish a system for continual risk monitoring. Regularly evaluate the effectiveness of risk mitigation strategies and be ready to adjust them in response to changing circumstances.

Innovate and grow

Far from stifling innovation, risk management fuels creativity and growth. Identifying and assessing risks help organizations allocate resources efficiently -- producing an environment that empowers teams to explore new ideas and technologies. Embracing calculated risks fosters a culture of propelling organizations forward into innovation.

Stimulate collaboration among departments, including research and development, regulatory affairs, quality assurance, and marketing. By motivating cross-functional teams to provide diverse perspectives on risks, organizations actively promote proactive risk mitigation to innovate and grow. 

Enhance stakeholder confidence

Stakeholders’ confidence rises when they experience robust risk management.  When these investors, customers, and employees experience a proactive approach to risk, they are assured that the organization is well-prepared for challenges and committed to sustainable growth. And, in turn, a robust approach attracts partnerships, investments, and a loyal customer base.

Develop a premium brand

Proactive risk management, critical for cultivating a premium brand (a high-end product or service), plays a pivotal role in sustaining the brand's reputation and ensuring consistent excellence. By meticulously identifying, assessing, and mitigating potential risks, a company can uphold stringent quality standards, a well-known hallmark of premium brands.

Proactive risk management fosters trust and reliability.  Both reinforce a brand’s image, and are vital components of a premium brand's identity.  Customers expect a consistent and exceptional experience. Moreover, proactive risk management enables brands to navigate uncertainties, demonstrating resilience and adaptability in the face of challenges. 

From supply chain integrity to legal compliance, effective risk management ensures that the brand remains synonymous with innovation, differentiation, and unwavering commitment to customer satisfaction. Ultimately, a robust risk management strategy contributes not only to protecting a premium brand's existing standing but also to ensuring its continual enhancement to reinforce customer loyalty and market distinction.

To understand this better, consider the following situation:

A retail company was facing stiff competition in the market. By implementing robust risk management practices, the company identified a potential risk in their supply chain that could disrupt product availability during peak seasons. By taking proactive measures -- such as diversifying suppliers and improving inventory management -- the company not only averted the risk but also enhanced their supply chain resilience. As a result, they were able to meet customer demand consistently, leading to increased brand loyalty and positive customer experiences. This strategic approach to risk management not only safeguarded the firm's projected growth but also strengthened its position in the market, demonstrating the tangible benefits of integrating risk management into business strategy.

Be resilient in adversity

When unexpected disruptions occur, organizations with a well-defined risk management strategy exhibit greater resilience. Whether confronting economic downturns, global crises, or industry-specific challenges, these organizations adapt swiftly and minimize the impact of adverse events.

As examples, during the pandemic’s challenges, forward thinking organizations capitalized on the surge in e-commerce demand by launching online businesses, or by innovating telemedicine responses.  In taking such proactive steps, they showcased resilience and adaptability amidst the pandemic's challenges. A proactive approach to risk transforms adversity into an opportunity to showcase adaptability and strength.

Build customer trust and loyalty

When pursuing organizational success and building customer trust and loyalty, risk management emerges as a breaker, not a barrier. By embracing risks, strategically managing uncertainties, and fostering a culture of innovation, businesses can navigate the intricate landscape of today's world with confidence. Recognizing the transformative potential of risk management paves the way for sustained growth, adaptability, and a competitive edge in the ever-evolving business environment.

When customers discover that a company manages risks smartly, their loyalty in an organization’s brand or service will likely rise, because loyalty showcases the brand's integrity and dedication to customer satisfaction. Not only does robust risk management safeguard against disruptions it also helps you develop lasting relationships.

Case Studies for risk driven growth:

  1. Venturing into fresh market: An IT company embraced risk-driven growth by expanding into new markets with artificial intelligence solutions, mitigating market saturation risks. Innovating and investing in advanced technologies bolstered their competitive edge, resulting in sustained revenue growth and market resilience.
  2. Expanding globally with regulatory understanding: A company aiming to enter emerging markets encountered intricate regulatory obstacles. By collaborating with a regulatory consulting agency, they pre-emptively tackled potential challenges, facilitating a seamless market penetration. Presently, they boast a robust global presence and a varied product range.

Effective risk management is your tool to maintain balance so that you can steer through uncertainties while maintaining a steady course toward your objectives. Viewing risk management as a facilitator rather than a deterrent empowers organizations to confidently navigate the complexities of the business environment to ensure a secure and sustainable journey towards success.  And again, that journey involves mitigating potential threats without hindering progress.  Using a measured approach can harness the momentum you need to grow and innovate throughout the toughest challenges. 



Mohit Khullar is an Executive Director with Grant Thornton Bharat LLP. Mohit has more than two decades of rich experience in areas of risk management, dispute resolution, commercial management, growth and strategy. Mohit is a member of Chartered Institute of Royal Arbitrators, UK and Indian Council of Arbitration, India. He is also a certified Coach from EMCC and is recognised as one of the top voices in Risk Management, Contracts and Mentoring by LinkedIn.

Arpita Maggon is a Manager-Legal with an IT company, bringing to the forefront a wealth of experience spanning over a decade. Her expertise encompasses a broad spectrum of legal domains, including contract management, dispute resolution, compliance management, procurement operations, and risk management.



Grant Thornton is one of the leading management and development consultancy firms that is part of Grant Thornton International which operates in more than 147 markets involving more than 68,000 professionals.. A truly Indian Firm with global connections - we work with businesses and government across industries and sectors, providing assurance, consulting, tax, risk and digital and technology transformation services.

When you face uncertainty and risk, do you see risk management as a speed breaker or a barrier that demands your being resilient and adaptable within the ever-evolving business landscape? Risks show up from diverse sources like market fluctuations, economic conditions, regulatory changes, competitive dynamics, technological shifts, and internal processes. Managing such risks involves mitigating them to enlarge opportunities and secure the organization's long-term goals and sustainability.

Mohit Khullar Arpita Maggon
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