Why Risk Is a Feature, Not a Flaw

If you're in a business that doesn’t take risk, odds are you're in a business that doesn’t make much money.

Risk is not a bug in the system; it is the system. Every growth decision, every new market entered, every product launched, every person hired… all of it carries uncertainty. The job of the CFO isn’t to eliminate that risk. It’s to underwrite it intelligently. To place the right bets, hedge the big swings, and make sure one rogue wave doesn’t tip the whole boat.

But here's the catch: the CFO is also the designated grown-up in the room. You're expected to be the one who sees the iceberg while everyone else is toasting on the deck. And in that duality, risk enabler and risk governor, is where the real job begins.

Too many finance teams fall into one of two traps:

  1. The Overbuilder: Layering process on top of process, approvals on top of approvals, until the business becomes a bureaucratic tar pit. Decisions slow down. Innovation stalls. And ironically, risk increases because now everyone’s operating through workarounds.

  2. The Cowboy: Going full speed ahead with minimal controls, trusting that “we’ll fix it later” when something breaks. That works… until it doesn’t. (See: any post-mortem from the 2008 mortgage crisis.)

The right approach is somewhere in between. It’s recognizing that some level of risk is the cost of success, but that smart controls can ensure you’re flying with a parachute—not just Red Bull.

You have to underwrite some level of risk, or else you don't have a business. But you also can’t slow down the business to the degree that people are complaining about it or can’t hit the goals you set.

So how do you enable growth without letting the wheels come off?

You build cheese.

In this post we’ll go through Risk Management 101 (a model that doesn’t suck the life out of your business):

  • Part I: The Swiss Cheese Model Explained

  • Part II: The Red Arrows… What Are You Actually Guarding Against?

  • Part III: Why Crisis Response ≠ Risk Management

  • Part IV: Building the Cheese… Proactive Controls That Actually Work

  • Part V: Why Finance Is Uniquely Positioned to Lead

  • Part VI: When Too Much Cheese Becomes a Problem

This post will position you as a thought leader when it comes to risk, giving you words to rely upon that people actually understand in their day to day lives. And it will give you a framework and mindset you can deploy within your company to stop more hazards from getting through.

Let’s get started.

Part I: The Swiss Cheese Model Explained

Risk isn’t a singular event - it’s a series of failures. Rarely does one mistake bring down a business. What usually causes the real damage is when several small breakdowns happen in sequence, unnoticed. That’s where the Swiss Cheese model comes in.

Popularized in fields like aviation and healthcare, the model works like this:

  • Each slice of cheese is a layer of defense—a control, a process, a safeguard.

  • Each hole is a weakness or gap in that defense.

  • The red arrows are the risks, trying to punch through.

  • When the holes in enough slices align, a red arrow gets all the way through.

    • That’s when bad things happen.

Visualizing It in a Finance Org

Let’s use Accounts Payable as a practical example:

  • Slice 1: Three-way match (invoice, PO, receipt must all agree)

  • Slice 2: Manual vendor verification (call the vendor, don’t trust the email)

  • Slice 3: Live customer/vendor list (no one-off mystery wires)

Each of these processes reduces the risk of paying the wrong vendor or falling for fraud. Will any one of them catch every mistake? No. But together, they drastically increase your odds. That’s the cheese doing its job.

Craig Conti, CFO of Vera Mobility, put it this way:

❝

“If something gets through here, it's going to be enough of an exception that it'll get the right level of visibility and we’ll be able to fix our process. That’s how I think about risk management—and I think about myself as one of the pieces of cheese, too.”

It’s Not Just AP — Think Cross-Functionally

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