24 February 2014
The recent flooding raises the question of risk management and, while the weather issues are an extreme, the principle of integrating risk management into the decision-making process is brought into sharp focus.
At one time in my career I used to do a lot of recruitment assessments looking at candidates' operational acumen. One of the stock questions to test their ability to assess priorities and the consequences of their actions was to give them a weather disaster.
The good candidates would be the ones who kept the objective to save as much as possible whilst accepting that there would be some loss of property and, probably, life. On the other hand there would be some who would be so determined to save everyone and everything that they would lose a lot of both.
Such artificial scenarios are not particularly realistic, but they do test how people approach risk and help to show how they consider the consequences of their actions.
When we have to balance finite levels of funds against where they will be best used we have to assess the consequences of a risk event occurring against the likelihood of the event occurring. Eight weeks or more of dire weather would have seemed unlikely last November, let alone at any time in the last couple of years. Even the long range weather analysis didn't forecast what we have suffered, but the consequences were predictable. It is one of those things that no-one will notice if you get it right, but you can look very bad if you get it wrong.
There might have been poor decisions around the events that have led to our current flooding, but I don't know because I have not got access to any of the facts. Consider yourself in this position though: you can spend your budget on mitigating the impact of something that is unlikely to happen or on something that supports your long-term objectives. These are choices we make all of the time in our private lives, but few of us get to make them on a national basis.
It's not always easy, and another of the things that you have to factor in is the long-term effect. The short-term populist actions of politicians have little place in commerce, but we have to live with them because it is how the country is governed. Long-term infrastructure plans are often ridiculed, but we need things like HS2 and better airport facilities for the long term health of the country.
It is lonely at the top when you have the hard decisions to make, but if you use the tools, apply some skill and think through the consequences of your actions you are on the right path. All you need beyond that is the courage to do the right thing. There is an art to decision making and whilst some can do it well naturally, it can be learned (or taught). Decisions need to be the best that they can be at the time that they are made and including risk management in the decision process is essential.
The chances of getting it right every time are slim, but if you make your decisions well then you will likely be right more often than wrong.
John Bowen is an FM consultant