A dozen notes on risk

A dozen notes on risk

1. Risk, like beauty, is in the eye of the beholder and contrary to what the great Spike Milligan once said: you can’t get it out with Optrex. Risk is about the threat, its likelihood and impact. It’s about insight, resource and the ability to apply resource to mitigate impact or delete a given risk. If I have better control over better resources than you, if I have the insight to see risk and where it will impact, my fear of risk will be less than yours, indeed, what to you may be a serious risk may be to me a simple inconvenience (perhaps you don’t see it at all – did you look?). Risk can be a tool.
2. A risk for me, may be a worthwhile inconvenience if it allows me to delete you from my competitive landscape. I may even be able to create risk for you because I know how much you like it…but I would have to be top sneaky to operate like that… right?…Surely no one does.
3. Keep your people alive to risk, make it an energy. Make it okay to point out risk and offer solutions. Listen and communicate.
4. Find the right tools or models for the job, right system or process. One that you can afford (clue: if your investigation system or tech costs more than the risk impact, you are not onto a winner). Use the tools effectively. There are all kinds of tools to allow you to investigate the information that defines potential risk, from complex software to simple four box models (hi/low likelihood-hi/low impact). What is your requirement? Do you need to monitor a thing, an environment or ecosystem, an economic slice? Do you need to look out for the uncommon, the different, that thing which doesn’t fit, the thing which doesn’t match expectation. Is there a curve on a graph you need to follow? Do you need to watch movements of businesses and people, see the evolution of ideas? All of the above.
5. Flexibility. Make whatever system or method of analysis you use flexible enough to accommodate changing variables in the environment or changing needs within the business. Use the output effectively.
6. When you know that you have something, a risk worthy of attention, a threat to strategy, to business as usual, or written into the script of a new opportunity, a threat that has both a significant likelihood of happening and a significant impact, you can then think about how to organise your resources to mediate that likelihood, impact severity and therefore your vulnerability.
7. Prioritise the steps or phases you can take to gradually mediate or defend yourself and look at the transition between one phase of defence and another.
8. Team tastic…are you able to deploy the right team, at the right time, with the right resources. Make sure you are flexible enough to bend your structures and create the right channels for people and resources to come together when they are needed.
9. A burden shared... Consult across units and stakeholders to identify threats and opportunities both real and imagined, do this as a general course of action and in relation to new developments. Do the same to help identify solutions. Monitoring or preventing the advent of a significant risk may be something best shared with suppliers or even competitors. It can be a case of shared purchasing or shared resource or combined expertise trading of skills required to mediate a given risk or scenario. Remember trust…you’ll need it.
10. An imagined threat not dealt with may pose a significant risk to the internal communication and morale. Don’t dismiss unevidenced fears, they may have a much greater impact than you think. Like I say…listen and communicate.
11. Risk in itself is sneaky, like a garden weed...stay on top of it.