The Exception-Tolerant Organization - Part 4

As explained in my introductory post on the Exception-Tolerant Organization, ETOs practice daily Risk Management. Another concept that sounds quite simple, but organizations find it difficult to sustain due to these key factors:

- lack of inertia and momentum
- lack of systematized and/or automated assistance
- key-man risk and blame

Lack of inertia and momentum comes from not instilling review activities into the organization's daily operations. Just asking these fundamental questions on a daily basis goes a long way towards an effective review process:

- What did I accomplish yesterday?
- What am I working on today?
- What obstacles or problems am I facing?
- How confident am I that the current goals will be accomplished on-time?

For many organizations that rely on reviewing large amounts of performance or other time-sensitive data, having a systematized and automated collation and presentation of this data is key to establishing a daily momentum. The systems and processes supporting them should have the appropriate fail-safes and redundancies to handle exceptional processing cases so that timely delivery (and thus Risk Management momentum) can be maintained.

Automated assistance is also key for the human side as well. In reviewing an organization's performance or exception conditions, leaning on automation can clear our heads of the mundane and manual steps, and allows us to focus on the exception conditions. Plus, what Director of Risk Management wants to arrive at work at 7 am just to push a button, or wait for reports 1 through 10 to finish running and printing before tackling the issues of the day?

Being a Director of Risk Management is a tough proposition to satisfy for an organization. Not only must you have volumes of data and information at your disposal, you must have the prescience to understand what is going to happen seconds from now in both your own building and halfway around the world. A Risk Management Director could be hailed as the heroic steward of the ship that avoids the icebergs of a competitive landscape, or could easily be the goat when the ship is steered right when perhaps it should have turned left.

For an organization, it is easy to both funnel singular responsibility and cast blame on one person when things blow up. But why do this, when after the blame subsides, the organization is still in an unfavorable situation when a risk materializes? Risk Management is one of those cross-cutting activities that the entire organization can practice effectively on a daily basis via continuous review and improvement. Allow your Risk Management Directors to get the support of the entire organization, and the Director will support the viability and competitive health of the organization in return.