5 Steps To Turn Risk Management Into A Strategic Edge

Shivali Kukreja, Head of Risk & Compliance, nib New Zealand: Driving Customer-Centric Innovation & Strategic Impact in Financial Services.

Risk management should not just be a checklist to be compliant. Rather, it should be a source of value, inextricably tied to your business strategy. Purpose-driven and customer-centric risk management does more than just protect; it propels growth and innovation.

With over 23 years of leadership experience, I have transformed risk and compliance functions within complex organizations, integrating them seamlessly into business strategies to drive customer-focused innovation and growth. As the Head of Risk & Compliance at nib New Zealand, I champion a proactive and value-driven approach to risk, emphasizing fairness, sustainability and customer-centric outcomes.

Here is how to transform risk management into a strategic advantage through five steps.

1. Make risk management purpose-driven.

Objective: Shift risk management from a transactional oversight role to a core values-driven function focusing on accountability, transparency and customer-centricity.

Approach: Define a specific mission for your risk management group that embeds purpose in all activities. This is more than about processes; it’s about creating trust and ownership within your organization. Everyone should be empowered to speak up, solve root causes of issues and behave in an ethical manner in keeping with the company’s mission.

Example: The top must set the right example, including the board, CEO and senior leaders, by embodying a culture of transparency and ethics. Equip employees with tools and frameworks to take confident, values-driven actions.

For example, we’ve built a board-level risk appetite statement dashboard to transform risk management. It’s a strategic enabler, aligning all risk types—strategic, financial and nonfinancial—with the overall enterprise risk profile. Fully integrated, it drives transparency and accountability across the organization.

Metrics ownership ensures swift action on those outside tolerance. Using leading and lagging indicators—key performance indicators, key risk indicators and key control indicators—alongside a red-amber-green methodology, the dashboard provides real-time risk insights. Continuous improvement keeps it relevant to evolving needs and regulatory expectations. Beyond compliance, it creates value, fosters a proactive risk culture and enables smarter decisions that build resilience and fuel growth.

2. Integrate risk management with business strategy.

Objective: Make sure risk frameworks are aligned with your business’s strategy for making risk decisions that would facilitate growth with proper exposure management.

Approach: Get a clear understanding of your organization’s direction, and align the risk appetite with that vision. Insert risk assessment into each strategic decision—from product launches to mergers to technology-driven transformations—to make well-rounded choices. Continuously monitor risks and resilience to effect necessary changes based on market fluctuations, competitive pressures or regulatory development.

Example: Place risk at the heart of every strategic decision. Model various real-world disruptions that could occur, and test resilience in areas such as supply chains, technology or regulatory changes. The result is an organization ready for uncertainty; each building block opens the door to greater strategic agility.

3. Focus on customer-centric outcomes.

Objective: To reposition the outlook of risk management toward value creation for customers through just and open processes that cultivate trust.

Approach: Establish how risk impacts customer experience, and take positive steps to minimize those risks. Map the entire customer journey, then develop risk frameworks that maintain trust at every touchpoint in acquisition and retention.

Example: Implementing a customer feedback monitoring tool at every interaction point allows organizations to capture real-time insights from complaints, service interactions and satisfaction scores. This data becomes a powerful resource for proactively identifying risks and uncovering opportunities for improvement.

For example, recurring feedback about delays in processing claims might reveal a systemic issue within an internal workflow. By analyzing the data, the root cause can be identified, enabling teams to collaborate on refining processes and implementing streamlined solutions to enhance efficiency.

Beyond addressing immediate issues, this kind of feedback loop can inspire broader enhancements, such as improving digital platforms for greater accessibility and user-friendliness. This approach mitigates risk while strengthening customer trust and loyalty. By turning feedback into actionable insights, organizations can foster continuous improvement and deliver better outcomes for their customers.

4. Harness technology for real-time insights.

Objective: To provide the organization with technology that transforms data into insight and insights into action so the risk function can be truly responsive/agile.

Approach: Invest in predictive analytics, AI, etc., but select carefully. The technology should augment human insight, not replace it, and evolve with your organization’s needs. Scalable and flexible systems should be put in place, which will handle holistic risks, from operational threats to third-party and cybersecurity risks.

Example: Use AI-driven insights to predict trends and identify vulnerabilities before they affect operations. Train teams to use tools effectively and understand their strategic importance. AI can forecast financial performance, improve quality assurance, detect fraud and personalize financial advice.

By embedding AI in critical functions, organizations turn insights into actionable strategies, optimize budgets, enhance customer outcomes and proactively mitigate threats. This approach reduces risks and drives resilience and competitiveness in a dynamic business environment.

5. Establish a flexible, adaptive risk management framework.

Objective: Make the risk management framework flexible.

Approach: Regularly review your framework to update changes due to new risks, regulatory changes and customer expectations. Embed resilience into your risk approach rather than making it just a one-off initiative.

Example: Rapidly gear up for changed customer behavior and/or regulation requirements. Periodically test and refine risk frameworks to ensure they address current challenges and allow the organization to maintain agility. Incorporate insights from post-incident reviews to identify gaps and drive improvements.

Conclusion

When risk management becomes a strategic differentiator, it ceases being about protecting your business but about driving growth, innovation and customer confidence. Harmonizing intentions with actual actions, embedding risk into strategic planning and exploiting technology effectively—all that plays a major role in shifting risk management from being a compliance need to one that really makes a difference.

This perspective, coupled with a culture of resilience and a customer-oriented approach, can propel sustainable success and help reimagine how your organization creates value. Risk management isn’t just a must; this is an opportunity to lead, adjust and thrive.

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