We asked Dr David Rubens, while we interviewed him (featured in our February print edition) if he’d give us a snifter of his new book, Strategic Risk and Crisis Management, and here he is, on ‘risk management and rational problems’.
Our understanding of risk management, whatever the historical period, cultural setting or threat, is based on a simple, fundamental principle. It is that we can observe the past, model the present and use that to project into the future. There is a belief that our present condition and situation is part of on an-going continuum, where what was leads to what is, and what is will create what will be. Although there have been changes throughout history, and in fact change is part of the environment that we operate in, there is nonetheless a belief in a single unchanging aspect of the world, and that is its rationality.
Patterns
Without that belief, we would not be able to see the patterns that are what allows us to understand risk, and to create models of engaging with it. If things happened randomly – if horses appeared out of mid-air or apples fell upwards from a tree rather than downwards, or a fork we were holding could disappear without cause – then the world would be fundamentally irrational, at least as seen from our current perspective, and we would not be able to make any plans to engage with it in a meaningful way. However, the world is not like that, and we are able to presume that what was will continue to be, and what is gives us an understanding of what will be in the future. Unfortunately, as I write, it is questionable as to how much these preceding statements still hold true. A new word introduced into our lexicon means that we must question the rationality of the world that we live in, or at least our ability to perceive the rationality beneath the seeming chaos that we observe and are caught up in. That word is ‘unprecedented’. If something is unprecedented, then by definition it falls outside of the framework of cause-and-effect rationality that we have built our model of the universe on.
Be creative
Preparation for today’s crises requires a change of mindset, although there are multiple types of challenges along the way: political-administrative challenges, the fabric of society and its resilience capabilities, and the ability for the necessary level of deep-thinking from policymakers. [Franch thinker Patrick] Lagadec further mentions bureaucratic inertia (to wait until the crisis fits its codes and rules) and the general loss of nerve both within public as well as along the chain of command in terms of taking decisions that would have an impact in preventing, mitigating, or responding to such events. In crises, there is often the belief that there should be someone who ‘knows the answers’ and who can take control. This is often in direct contrast to the skills and capabilities organisations need to run in conventional times, which requires the ability to develop structures and frameworks that follow processes and procedures. Crises, by definition, force leaders to break through silos and to be creative in finding new solutions. The higher the stakes, the more important is direct and determined leadership from the top – this requires mental preparedness, conviction, and vision.
The ability to be sensitive to the indicators of potential impending crises is a critical issue. These signals are often silent, hidden, and elusive. There may be background noise that precludes them for being identified, and alternatively there may be the desire to suppress bad news and to block messages about those signals being passed farther up the management chain (‘normalcy’ bias and heuristics). Both issues create a situation where it is the lack of sensitivity to potential warning signals that prevent an organization from either recognizing a potential crisis before it escalates to such a condition, or to have the readiness to respond in an appropriate and effective manner once such signals are detected.
Changed role
The role crisis management has changed. Ready-made answers, conventional tactics and interpretations are no longer robust enough to stand up in the face of the high-impact challenges associated with modern crises events.
An agile, integrated big-picture approach to risk assessment, preparedness, response and recovery, backed by a culture and technology that respects the seriousness of the issues, and accepts the responsibility to create a risk-sensitive and crisis-ready organisation is the starting point for the development of effective risk management. Holistic concepts with inter-organisational coordination, information exchange, resource allocation (e.g., professional personnel familiar with engaging with chaos and who are to be responsive to unstable situations) and non-linear response strategies (involving the integration of multiple stake-holders, both internal and external, formal and ad hoc, including both communities and non-profit sector organisations) are increasingly important in setting a perspective that is able to go beyond traditional linear, simplistic and stove-piped events that had clear boundaries and limited impacts. The question now is: What does it take to move into the crisis ready state?
This is from Dr David Rubens’ book, newly published by Kogan Page.
About David
He’s the founder of the ISRM (Institute of Strategic Risk Management).
