The academic landscape is fraught with risk—everything from hazardous chemicals and internal fraud, to flu outbreaks and budget shortfalls.
It seems obvious that any college or university would invest effort to identify and rank its current top risks, if just to assign the right level of attention and resources to each. Yet many academic institutions don’t follow through with enterprise risk management (ERM).
Tackling risks one by one
A survey conducted last year by the Association of Governing Boards of Universities and Colleges and United Educators found that boards “continue to discuss risk on a largely ad hoc basis” and that “higher education is conflicted when it comes to ERM.”
Based on survey responses from 921 college leaders, the report found a gap between those who said risk is a high priority and those who actually had enterprise-wide risk evaluation in place.
The authors conclude that “the state of ERM in higher education leaves many institutions unprepared to address high-priority risks that may endanger the realization of strategic plans and institutional mission.” In particular, they warn against addressing risk ad hoc—as when governing boards and cabinets discuss risks “as needed,” rather than setting a schedule for regular updates and reports.
Why do colleges and universities have trouble surveying risk across the institution? The AGB/UE survey report suggests that “uneven implementation by institutional administrators is stalling efforts to fully advance ERM.”
Are campus leaders reluctant, or do they need a fresh approach? Let’s see what the uneven implementation of ERM means, and consider three steps that help ensure progress.
Steps to ERM implementation
1. Overcome the language barrier. A campuswide effort can succeed only with the support of academic leaders, including deans, chairs and faculty representatives. To reach them, those charged with establishing ERM may want to replace business-oriented vocabulary with language that befits a campus culture.
Academic risk managers can describe the concepts in a language more lively and flexible than what’s found in risk management guides. A blog, monthly tips in the campus newsletter, presentations with graphics, and talking points for meetings can help to spread a new language—and culture—of risk.
2. Navigate risk with a governance map. Shared governance affects many parts of risk management, such as directing teams that cross departmental lines, assigning ownership of risk and getting policies approved. Try to activate ERM in the context of faculty tenure, student government, elected committees presenting recommendations to appointed executives, and alumni networking via social media.
If experts brought in to help with risk have trouble seeing the nuances of shared governance, the resulting image of ERM “stalled” by invisible organizational barriers may offer a second explanation for why on-campus risk efforts aren’t always followed through.
But if those who lead risk management understand how institutional decisions are made, they’ll be able to map which risks belong where, and which others threaten to fall through the cracks if not assigned unambiguously to one owner. Progress on managing institutional risks can now be reported to the president and reviewed annually by the board. These routines form the outline of a good institutional risk-management program.
3. Activate a risk culture. Approaching ERM as a shared effort based on consensus about the academic mission will foster a high level of risk awareness.
As this culture grows, we can embed risk considerations into everyday college activities, such as budget meetings, orientation programs, planning for student field trips, performance reviews and event scheduling, among others.
Experience suggests that ERM can be successfully adopted by colleges and universities if policies remain relevant to the academic mission and managed to their full potential.
Paula V. Smith is a professor of English and director of the Purposeful Risk Engagement Project at Grinnell College in Iowa.