It takes years to build a successful company; but, the fact is that more companies spend time growing their business than protecting their assets. In a business culture that tends to place greater value on growth and profit rather than exposing and fixing company vulnerabilities and risks, it makes sense, but the problem is that a single crisis can take down an entire business and leave it struggling for relevance.
What is vulnerability?
Vulnerability is a series of weaknesses at different levels of a company that, if neglected, can turn into a problem. Here are some common examples of where vulnerabilities are often found:
- Personnel: Even something as simple as a skills gap within your staff cohort can leave your company vulnerable to problems. From a reputational perspective, this can have severe consequences if these skill gaps are not addressed.
- Technology: It seems that most companies are worried about being hacked from an external source, but how many companies invest enough time into ensuring that the right protections are in place? Even something as simple as data loss due to not having in place a disaster recovery plan can cause havoc.
- Governance: A weakened board of directors, a rogue CEO, or a lack of accountability at leadership level can all lead to problems.
Identifying and addressing poor governance
While most people recognize common risk areas such as technology, vulnerabilities in company governance can be harder to identify. It is not just that a single bad decision at the top levels can affect the direction of the company, but that ongoing poor governance can cause a company-wide cascade of failures that can lead to unethical behaviour. This has ramifications not just in terms of workplace culture, but also in terms of possible legal problems.
So, how can multiple governance vulnerabilities be fixed? Here is a formula that can solidify your governance if followed strictly and without fear or favor:
The best way to tackle weaknesses in governance is to have a thorough and honest assessment of each and every level of leadership. Look at all of the possible weaknesses that could lead to a problem or crisis. This process often follows the following formula:
- Assess each department independently,
- Have every department assess every other department in the context of communication, interactivity, attitudes, and skills,
- Measure against expected performance metrics and debate whether the expected metrics are reasonable or not,
- Have each department or team assess themselves and then compare this with other assessments to see where the disparities are.
In some cases, it may even be preferable to have an independent third party do most of the assessment, since they will not have the same sorts of internal biases that could prejudice the process.
Develop a response
When all data has been gathered through the analysis stage, it’s important to address the most critical areas of vulnerability. It may be that some vulnerabilities are harder to fix, but some of the most common, such as security risks, can be nullified fairly quickly through a change in policy or behavior.
The first goal here is to patch those areas of vulnerability that can addressed quickly and thereby mitigate the chances of a crisis happening. The second goal is to address other more difficult and complex vulnerabilities by having a clear plan of action in place.
Make your company airtight
It may not be entirely possible to eliminate all vulnerability, but approaching the process with an open mind and an attitude of rigor and honesty is the key to developing reasonable responses. Vulnerabilities in governance can often be the toughest to address because they occur at the leadership level and often have company-wide ramifications. However, it is wise to recognize just how important it is to nullify as much vulnerability as possible through a rigorous process.