A recent, accident in the Alps is a frustrating, yet empowering reminder.
Sep 10th, 2014
Accident in the Alps is a frustrating, yet empowering reminder
Riskope thanks Federico Sasso for this contribution.
In our days to day practice at Riskope we are regularly confronted with what we call the “specialist syndrome” and have to tackle political resistance which often delays or hinders rational Risk and Crisis Management implementations.
All that seems like a recurring theme which usually foreshadows a disaster. If you think we are being negative, go back to a post Riskope published three years ago. It focused on a rather common fallacious perception of what “high level risks” are. As we mentioned it in the post the anecdote happened with a state owned European Railroad. Top Management ended the seminar with a disdainful judgment toward the “new ways” of ERM. In fact the CEO sent us away claiming that we were too “natural hazards oriented” and not enough “business oriented”.
Why do we recall that right now? Well, the said company was hit in the past few years by a number of severe natural hazards which generated casualties, national media attention, and enhanced scrutiny. Riskope had “written that story for them” before it happened…if only they had been willing to listen….
Corporate prestige, top managers’ initial gut reaction and risk siloing effects are another improper, but sadly common way to define the threats a corporation or entity will face in the “future” without properly evaluating them. Those entities are indeed far away from a correct and rational Risk and Crises Management approach.
Railway, road, communication, and water supply disrupted by a land slide (natural hazard)
Unfortunately, the mudslide which recently hit the railway track caused also the derailment of a passenger train into a ravine. This shows how the political/administrative shortsightedness towards Risk Management can be dangerous especially when magnified by a “Poor Risk-Culture”.
The opportunity to avoid new projects’ opposition, families’ griefs and corporate failure is within reach. By using appropriate methods we would have a robust stance, we would stop the risky behavior by promoting the rational idea of “thinking about the unthinkable” and act in a controlled manner. This would certainly lower the appeal of some alibi buzz-words like “Black Swan” or ineffective tools that abound on the world market.
Although it seems proved that, we, human, have short memories, we cannot ignore what happens everyday, beneath our eyes. It would be fantastic if we start correcting our way of dealing with uncertainties and risks.
Tagged with: accident in the Alps, black swan, political resistance, Poor Risk-Culture, risk siloing effects, specialist syndrome
Category: Consequences, Hazard, Mitigations, Risk analysis, Risk management, Uncategorized
Risk review and planning is more often than not neglected at the altar of cost and as you rightly said the most common response from managements to the suggestions from Risk managers is ” you are …… not enough “business oriented””. It is a narrow minded approach to maintain costs, mostly justified by the thinking of managers that the cost during his or her tenure should not violate budget, once he or she moves on and when and if the risk does fructify the manager then shall shoulder the brunt of the risk. There is no mechanism that I have ever seen to hold people responsible for deeds done by them in the past once they have moved on, whether in the public domain or in corporates. However what is sad is that the boards of large companies and government bodies get swayed by the cost and in their arrogance of being game changers for nature or short sight to gain quick profits loose the vision of long term. Though later these same companies or government bodies suffer hefty costs, but it is the common man which suffers, through loss of life or assets or both.
And unfortunately we do not learn from our mistakes..
One of the standard approaches to risk management: pray it never happens…