Industry buzzwords such as “Risk Management” and “Risk Mitigation” seem to echo in the hallways of virtually every office building in America. From industries such as Insurance where quantifying and qualifying risk is a staple, to Main Street America where risk is simply selling enough product to make monthly rent, we are faced with risk every day.
In evaluating our own risks, the simple principle coined by Gordon Graham, Founder of Lexipol, is simply, “If it is foreseeable, it is preventable.” For all things in life, if we can reasonably foresee a consequence, action, or reaction to something, we can usually prevent it. Take the simple example of driving a car from your home to your office. It is foreseeable your car could not start in the morning, it could breakdown while on the road, you could be involved in a car accident, along with a multitude of other possible outcomes. For these risks, we may try to mitigate them by becoming a member of the Auto Club or other roadside assistance program, carry various amounts of automobile insurance, have the vehicle serviced regularly, possess a valid driver’s license, etc etc etc.
The vast majority of the time, we are able to make it to and from work with no problems, and thus become bias to the normalcy of success. The longer we experience this success, we may decide to no longer participate in the roadside assistance program, may lower our auto insurance coverage, extend the time between servicing the vehicle and other money saving tactics. It is not until one of these risks manifests itself, and always at the most inopportune time possible, that we are reminded of the inherent risks of driving and owning a vehicle.
One may attempt to remove as much risk as possible and begin taking public transportation, or use the myriad of ride-sharing transportation app services. This, however, adds a layer of complexity and inconvenience to the average person. Additionally, the risk is now shifted to the reliability of transportation schedules, mechanics and maintenance of equipment, and individual driver or operator experience. In reality, risk has not been reduced, but rather reallocated into different categories.
In business, we must identify those risk that are inherent to everyday operations.
From employees to machines, what investments are being made to minimize the risk? And are you truly engaging in managing risk factors or simply shifting risk into different areas? Worst, is the principle of risk management simply hoping that the risk does not appear? The common areas of focus tend to be financial risk, profitability, investments, appropriate hiring, and other day-to-day factors; as these are daily “in your face” risks. However, areas such as security, safety, intellectual property protection, emergency preparedness, workplace violence and the like often fall into the normalcy bias of success, since these incidents occur far less frequently. It is these risks areas that are addressed on an annual basis (sometimes) and usually by under-qualified employees whose extra collateral duty included being a part of the “safety team.”
Training, subject matter expert consultants, equipment, and a conscious awareness to what is being actively done to manage these risks to industry best practices and standards of care is the equivalent to the roadside assistance program for business. By investing early in these high risk, low probability incidents, you are insuring a certain level of care and insurance both for the business and for its most valuable asset, its members.
While the hope is you’ll never need to use any of the training, resources or policy, when an incident does occur, you’ll be glad you had it. For at the end of the day, hope is not plan.