Agile risk management could mean that risks specialist let go of their own account portfolio and start working as a scrum team. This is how this could work:

When a traditional bank transforms into an agile organization, its risk management department need to become agile as well. Risk management is often organized as a team of individualistic specialist, each with their own portfolio of accounts or cases.

Agile organizations are flexible in adjusting priorities and reassigning capacity. Teamwork is often the quickest way to introduce this flexibility. A team of specialists can set priorities across all of their portfolios. When one portfolio requires more capacity than its owner can deliver, the team can reassign capacity.

One way to organize this is to create risk management Scrum teams.

There is a downside to this approach – the reason that Scrum isn’t widely used in risk management today. It takes time to get to know the details of a complex case, and it would be a waste of time when a running case is transferred from one specialist to another. However, the benefits could very well be greater:

Scrum teams will work in weekly sprints, delivering ‘fully functional’ deliverables in each sprint. This is the first benefit of this way of working: transparency on what will be delivered each week. In the old way of working, throughput times could get quite long from time to time. And the weekly rhythm gives the organization the agility to adapt to changes. What exactly ‘fully functional’ would mean will depend strongly on the type of risk management.

Second benefit: optimal priorities. The sprint deliverables are made up from the priorities (must haves and nice-to-haves) of all individual risk managers for that week. However, after this first round of collecting priorities, a ‘product owner’ will decide which of these individual priorities are most important. Priorities can be given to where the highest impact can be made on reducing risk. In the old situation, focus would always be on the highest risks within one portfolio. Scrum would give priority to a nr 2 or 3 priority from one portfolio when the related risk is higher than the nr 1 from another portfolio.

Third benefit: the power of teamwork. A team of professionals knows more and can make better decisions than individuals. Our experience with Super7 Operations shows this, also in highly specialist organizations like arrears management.

It’s going to be interesting how a truly agile bank will organize its risk management. I’m looking forward to learning what works. Menno R. van Dijk.