What If Engagement Was A Risk Management Issue?

“We have a fundamental belief that our single most important asset is our people,” Jones said in a recent interview. “If you think about the industry, and assets and liabilities, it’s all about maintaining risk. For us that means developing a culture where we’re so focused on making sure they have all the right tools to do their jobs.”

If I gave a quiz and asked you the industry spokesperson who said this you would probably say a head of HR or maybe a CEO. What if I told you the truth teller was a banker, albeit a CEO? What if I also told you he positioned employee satisfaction as a “risk management” issue?

He also said, “I go back to the basic tenet that you need to make sure people are always viewed as your most important asset,” says Bob Jones, chairman and CEO of Old National Bancorp. “Don’t take them for granted.”

Employee engagement as risk management

He made those comments in an interview published in American Banker Magazine. It is the first time I have heard engagement described as a risk management issue. But if you sit back and think it through, your most important assets, if not managed properly, would be considered a huge risk to an organization.

According to Investopedia, risk management is the process of identification, analysis and acceptance or mitigation of uncertainty in investment decisions. Essentially, risk management occurs any time an investor or fund manager analyzes and attempts to quantify the potential for losses in an investment and then takes appropriate action given his investment objectives and risk tolerance.

Yes, big words, and it all sounds very complicated indeed. But think what this would mean if all organizations really understood how they treat this most important asset

The concept of risk and engagement

This concept of risk to me is very intriguing as paired with your workforce. Risk, as Investopedia explains, involves the chance an investment‘s actual return will differ from the expected return. Risk includes the possibility of losing some or all of the original investment. If you think of your compensation as an investment, you would be looking for a certain amount of return, especially since that is the largest amount on the balance sheet. It would be a huge risk based on this definition if the actual return was below certain norms.

Just maybe this is the approach we can use to get through to the C-suite to make the business case of how this engagement thing is connected to the bottom line.

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I have worriedly seen discussions around this happiness issue. However, that is an emotional connection which doesn’t carry much weight in the board room. For the most part, they could care less.

It has to relate to the performance of the business and we have not made that connection. That is why the numbers never change, because it is not a C-suite issue as it would be if it were a “real” risk management issue. Because if that were the case and the numbers were dismal, it would be all hands on deck trying to make the correction.

So I applaud Bob Jones, for giving this thought provoking interview. I think his last response in this article says it all:

What advice would you give to other banks about benefits?

Steal as many good ideas as you can. I go back to the basic tenet that you need to make sure people are always viewed as your most important asset. Don’t take them for granted. We use the analogy that when you’re dating someone you do those nice things in the beginning but sometimes when you’re married for a long time you forget to do them. But as you’re thinking about your associates, you have to remember the little things make a big difference, like picking up a phone and telling someone, “Thank you.”

On a closing note: This article came from American Banker, which shows we should get out of our comfort zone of reading just HR related material. My list includes CEO.com, CFO.com and CMO.com and now the American Banker.

Ron Thomas is Managing Director, Strategy Focused Group DWC LLC, based in Dubai. He is also a senior faculty member and representative of the Human Capital Institute covering the MENA/Asia Pacific region.

He was formerly CEO of Great Place to Work-Gulf and former CHRO based in Riyadh. He holds certifications from the Human Capital Institute as Global Human Capital Strategist, Master Human Capital Strategist, and Strategic Workforce Planner.

He's been cited by CIPD as one of the top 5 HR Thinkers in the Middle East. He received the Outstanding Leadership Award for Global HR Excellence at the World Human Resources Development Congress in Mumbai, and was named as one of the 50 Most Talented Global HR Leaders in Asia

Ron's prior roles included senior HR positions with Xerox HR services, IBM, and Martha Stewart Living.

Board memberships include the Harvard Business Review Advisory Council, McKinsey Quarterly's Executive Online Panel, and HCI's Expert Advisory Council on Talent Management Strategy.

His work has been featured in the Wall Street Journal, Inc. Magazine, Workforce Management and numerous international HR magazines covering Africa, India and the Middle East.

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