The electric utility sector is one of the more stable industries from a workforce perspective. Yet we are seeing more vacancies, partly from retirements but also from a contracted U.S. workforce, fierce job competition, and employees spending less time in jobs. In this environment, utilities need a proactive knowledge retention plan. A successful utility operates as a team of collaborative people,  not as a collection of solo players. The organization and its people must continue uninterrupted operations even if a key employee departs. 

Following approval of the strategic plan, there is an audible sigh of relief in the board room. The months of planning and engagement have resulted in clearly defined strategic priorities, and your leadership group is aligned to deliver on a great set of strategies. 
 

The short answer to that question is yes, you really should establish a risk tolerance. It is an important tool for managing your utility.

A utility chief risk officer once said to me, “If we establish a risk tolerance, I am afraid that will be seen as a green light to take risks.”
 

Enterprise risks refer to financial, operational, regulatory, legal, environmental, and strategic risks that significantly impact an organization (the “enterprise”). Risks cannot be avoided, but they can be identified and ranked so that an organization can proactively address them. Risk ranking helps define an organization’s biggest gaps and vulnerabilities; by ranking risks, an organization can better allocate capital and human resources.