Clear concise reporting for the wider management chain must be easily available to keep management apprised of the magnitude of price risk and the success of actions taken to cover it.
- Visibility requires thorough reporting. On any mission in the field commanders and troops alike need to know what they’re up against, their own state of affairs and the weaknesses they have that must be covered for. Businesses running price risk management programs need to be able to call upon a suite of reports that present the same strategic picture.
Training and planning embed managing risk into company culture so focus can be kept on profit. This is not intuitive so make sure the training and planning gets skilled outside help.
- Visibility demands knowledgeable employees. Business schools neglect price risk management so an innate understanding of it is not everyone’s forte. In our experience this is especially true of those in disciplines for whom the definition of risk is not the same. Training is a must for employees; many who would otherwise actively sidestep “unintelligible” risk responsibilities.
- Visibility relies on looking forward. This is especially true with cross-functional risk-related responsibilities. Practically speaking, will busy employees prioritize something they’re not measured for? Price risk improvement targets must form part of the company plan and include activities required of and for all involved.