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Argos Press |
Preface |
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In the vast majority of situations, a manager does not have to be a technical expert to be an effective risk manager; he or she simply needs to be aware and sensitive to what is going on, and to be able to contemplate what may develop in the future. In essence, every decision maker needs to develop heightened situation awareness before he or she can become effective in risk management. This is the simple but powerful theme of this book. Risk management is covered in many management texts and courses, most of which seem to start with the assumption that the reader, or attendee, is well equipped to recognise risky situations and identify individual risks. The research underlying this book suggests that the assumption that managers have detailed understandings of the nature of risks is at best, highly questionable and, at worst dangerous. The same research also suggests that the intelligent non-expert, a reasonable person, knowing or seeing what can be reasonably known or seen, can make reasoned and sound choices about risks and risky situations, often long before they develop into sinister consequences. What we must do first is to spend time investigating, contemplating and deliberately learning about the true nature of risks. We need to know how risks grow and manifest themselves, either singly or in combinations. Only then might we be able to manage risks much more effectively. How managers perceive and react to risky situations is as important, perhaps more so, than the actual risks they might be trying to manage. Risks that are identified but go untreated may produce the same final consequences as those that remain unidentified. The threat here is that managers through their inaction, or incompetence, might let the final undesirable consequences play out anyway. Chapter 1 discusses the general nature of decision making and of risks and the role of the decision maker in the management of risks. Techniques to depict and analyse cause-and-effect, that is, causal relationships are demonstrated. A clear and strong distinction is made between correlation and causality. Chapters 2 and 3 use empirical studies to reveal the circumstances and reasons for the ultimate occurrence of sinister consequences. In each case it was found that sinister consequences could have been avoided through routine but effective risk management. Based on the cases studied and material drawn from the systems-thinking literature, Chapter 4 builds characterisations of the nature of risks. Such characterisations are intended to help us recognise risky situations when they appear in real life situations. Chapter 5 offers innovative and practical ways to establish the risk context and identify risks. A set of principles of method is developed to help us identify situations involving systemic risks and take appropriate remedial actions or put into place appropriate risk management strategies. Practical tools and techniques are explained that will make the risk management process more effective. Chapter 6 presents a comprehensive tutorial that explains and demonstrates how to go about building real-life risk management interventions. The chapter also explains advanced techniques which might be needed if the qualitative techniques demonstrated in this book are insufficient. Chapter 7 relates the material in previous chapters to the generally recognised processes for risk management and problem solving. This book is not about conducting forensic investigations to find the single root cause (if there is ever only one) for something going wrong or, as so often happens, apportioning blame to those who might have been closest to events when things went badly wrong. By the time undesirable consequences have played out, such as when a tragedy has occurred, or a business has gone bankrupt, it is all too late. This book is about seeking to understand risks for what they are and devising the most appropriate ways of treating them, hopefully producing situations where undesirable consequences do not result, or if they do their impact is markedly reduced. The question this book set outs to answer is this: ‘how can managers, through routine management activities, mitigate the risks that might arise within their domains of action?’ |
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