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Top fi rms neglecting strategic risk, says ICE

ICE news

ICE RESEARCH has revealed that some top engineering firms are neglecting management of strategic risk.

STRATrisk, a two-year joint project with the Faculty & Institute of Actuaries surveyed 50 engineering and construction firms.

Its complete results will be presented at a seminar in London in November, chaired by Nichols Group chief executive Mike Nichols.

Nichols refused to name and shame fi ms, but admitted that there was a 'spectrum' of companies' approaches to strategic risk, with some firms not considering it an issue for directors and others not really aware of the issue at all.

He added: 'It was interesting to see through this research that there were some companies perceived by their peers to have a good approach to managing strategic risk, but that the perception was not always borne out by reality.' The 50 organisations interviewed were asked to identify the biggest sources of risk to company strategy, with company reputation, people-related problems like illness and government intervention topping the list.

The fi dings of STRATrisk demonstrate that handling risk is primarily a task for company directors and that those firms performing well tended to be managing their strategic risk well.

Nichols said: 'Strategic risks are different from the risks people are most familiar with and there's a difference in degree and characteristics to the particular risks engineers deal with in their day to day projects.' While engineers can calculate risk on projects based on an event that may occur, Nichols added, the dimensions of strategic risk change all the time.

As well as the half-day seminar on November 23, a summary report will be produced that will form the basis of guidance for the industry and a starting point for further research.

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