A Short Guide to Facilitating Risk Management C\ Taylor & Francis ~Taylor & Francis Group http://taylora ndfra nci s.com A Short Guide to Facilitating Risk Management Engaging People to Identify, Own and Manage Risk Penny Pullan and Ruth Murray-Webster Illustrations by Vanessa Randle First published 2011 by Gower Publishing Published 2016 by Routledge Park Square, Milton Park, Abingdon, Oxon OX14 4RN 711 Third Avenue, New York, NY 10017, USA Routledge is an imprint of the Taylor & Francis Group, an informa business Copyright © Penny Pullan and ruth Murray-Webster 2011 Penny Pullan and Ruth Murray-Webster have asserted their moral rights under the Copyright, Designs and Patents Act, 1988, to be identified as the authors of this work All rights reserved No part of this book may be reprinted or reproduced or utilised in any form or by any electronic, mechanical, or other means, now known or hereafter invented, including photocopying and recording, or in any information storage or retrieval system, without permission in writing from the publishers Notice: Product or corporate names may be trademarks or registered trademarks, and are used only for identification and explanation without intent to infringe British Library Cataloguing in Publication Data Pullan, Penny A short guide to facilitating risk management : engaging people to identify, own and manage risk – (Short guides to business risk series) Risk management Risk managers Industrial management – Employee participation I Title II Series III Murray-Webster, Ruth 658.1'55-dc22 Library of Congress Cataloging-in-Publication Data Pullan, Penny A short guide to facilitating risk management : engaging people to identify, own and manage risk / Penny Pullan and Ruth Murray-Webster p cm – (Short guides to business risk) Includes bibliographical references and index ISBN 978-1-4094-0730-0 (hbk : alk paper) – ISBN 978-1-4094-0731-7 (ebook : alk paper) Risk management I Murray-Webster, Ruth II Title HD61.P85 2011 658.15’5–dc22 2010054245 Reprinted 2014 iSBn 9781409407300 (pbk) Contents List of Figures and Tables vii About the Authors ix Forewordxv Acknowledgementsxix 1 Introduction What is Risk Management? The Risk Facilitator 39 Facilitating the Risk Management Process 57 Risk Workshops 79 Potential Pitfalls and How to Overcome Them 103 Ten Golden Guidelines for the Risk Facilitator 137 Index145 v C\ Taylor & Francis ~Taylor & Francis Group http://taylora ndfra nci s.com List of Figures and Tables Figure 5.1 Figure 5.2 A summary of steps to start up any workshop (used with permission) A group map built by APM members about the issues they face with risk workshops (used with permission) 88 93 Table 2.1 Comparison of risk management standards 11 Table 2.2 Risk attitude labels 24 Appendix A Factors with the power to influence 36 perception and risk attitude vii C\ Taylor & Francis ~Taylor & Francis Group http://taylora ndfra nci s.com About the Authors Penny Pullan The majority of Penny Pullan’s work is with people in multinational organisations who are grappling with tricky projects and programmes of change Tricky usually means a combination of: zz risky, with outcomes; uncertain zz working with virtual team members dispersed around the globe; zz complex and often ambiguous requirements; and zz complex and often culturally diverse mix of stakeholders, who need to be interested, engaged and involved ix Potential Pitfalls and How to Overcome Them spent on actual problems (issues) is tracked, and there is a focus on learning lessons from completed work Most importantly, everyone needs to ‘walk the talk’, that is, make it a daily habit to discuss what’s risky and why We’re so busy doing day-to-day delivery that risk management gets squeezed out Yes, but how much of your day-to-day delivery is caused by managing actual problems and fire-fighting? Many of your current issues would once have been uncertain threats, which could have been managed proactively What about your missed opportunities? Until you put an appropriate risk management process into place, you’ll continue to be affected by avoidable issues and missed opportunities Unfortunately, to see an improvement, you need to put in additional effort in the short term This quickly repays as you start to manage risks and so there are fewer crises No one can see the pain we’re avoiding We’re not noticing the improvements we make This is a tricky one Of course the work that you to avoid costly threats is valuable But to convince others of the value of your work, you will need to measure it in some way See Chapter for ideas on what to measure 133 A Short Guide to Facilitating Risk Management Senior managers in my organisation don’t buy in to risk They can’t see the value It’s seen as a waste of time and counterproductive This is another area where measures can help The base-line metrics of ‘how it is now’ can be an eye-opener for senior managers who may not have paid much attention to the detail of risk management To build support, you need to be able to explain – or better still – show the benefits of risk management to people in your organisation at all levels See Vivien’s story and Anna’s story in Chapter to see how they were influential in their respective organisations This may involve learning lessons from past failures in managing risk Offering appropriate training can help spread the understanding across your organisation The key thing though is to focus on what matters most, and make progress visible My organisation tends to ‘jump on’ anyone who comes up with negative threats How can I bring in good risk management practices without limiting my career? The most effective environment for risk management is one where there is a ‘no-blame’ culture In such a culture, people are rewarded for highlighting threats that can then dealt with appropriately in advance of any negative impact Think about how you can encourage this Sometimes it’s useful to talk about a possible response to a threat when you first mention it Doing this is often perceived as positive, that is ‘this bad thing may happen, but we can this now …’ Raising the risk only, with no potential solution, can be seen as negative In our experience though, negative reactions to risk identification from senior management can often happen 134 Potential Pitfalls and How to Overcome Them when risk registers are full of ‘normal’ risk, such as statements like ‘we may not have the resources when we need them’ This is not useful General variability about resource availability needs to be built into plans Specific risks associated with specific resources for specific work are useful to include in the risk register only if the resource type is scarce and the work is critical When we present the results of our workshops, senior managers think we’re being negative They say things like: ‘I want a can-do attitude – solutions not problems’ It’s important to make sure that the senior managers understand the benefits of good risk management Once that’s in place, then make sure you present both positive opportunities as well as the negative threats Be careful to present these at an appropriate level of detail for the people you’re presenting to With senior managers, this can be much more ‘big picture’ than the risk facilitator is used to Our organisation lacks deep experience in risk and in risk facilitation How can we develop this quickly? While this book has a detailed plan for doing risk management it can take some time to build up from scratch This can be speeded up by bringing in risk facilitation experts to support you whilst your organisation is developing With help, people can develop the skills they need for your organisation to become self-sufficient in implementing effective risk management 135 A Short Guide to Facilitating Risk Management This chapter has discussed many pitfalls, all raised by existing risk practitioners You may be feeling a little overwhelmed with all the detail We’ll therefore finish this book with a quick summary – our Ten Golden Guidelines for the Risk Facilitator 136 Ten Golden Guidelines for the Risk Facilitator This final chapter is deliberately very short It summarises the book with ten golden guidelines for anyone involved in facilitating risk management 137 A Short Guide to Facilitating Risk Management There are lots of pitfalls, but you can plan and prepare carefully and avoid falling into them Risk management is difficult to well, and a facilitator can make a big difference The role of the facilitator is to make it easy 138 Ten Golden Guidelines for the Risk Facilitator Risk facilitators need a whole range of personal qualities, as well as a deep understanding of the risk management process Risk facilitators also need to be ‘vegetarian’ They focus on the facilitation process, and the risk management process, but stay out of the ‘meat’ of the work content 139 A Short Guide to Facilitating Risk Management Risk facilitators need to engage the right people at all times Risk facilitators need to keep groups energised, as well as engaged, while maintaining their own level of energy 140 Ten Golden Guidelines for the Risk Facilitator 7 Risk facilitators add lots of value when they have the skills and credibility to challenge the participants They need to resist the temptation to challenge on content, staying vegetarian Careful preparation is the key to successful workshops 141 A Short Guide to Facilitating Risk Management Things go wrong Different people have different perceptions of what is risky and why Conflicts will arise Stay calm and help the group to find a way through 10 Facilitate risk management well, and you’ll engage others and make sure that the risk register is cobweb-free! 142 Ten Golden Guidelines for the Risk Facilitator Risk management is very important if organisations are to make good decisions in risky and important situations As a risk facilitator, you can add real value by making the process easy for your colleagues, so they can be creative, productive and have fun 143 C\ Taylor & Francis ~Taylor & Francis Group http://taylora ndfra nci s.com Index jargon 129 language 108 lessons learned 92, 99 open, honest 126 preparation 97, 118, 141–2 agenda 89 objectives 81, 83, 86, 89, 119 recorder 83 keeping information visible 86, 94, 121, 134 staying calm 90, 142 timekeeper 83, 89, 130 theoretical background 118 value of 54, 116, 131, 141 virtual 5, 41–2, 48, 58, 62, 67–8, 84, 87, 92, 97–8, 127–8 vested interests 126 alien invasion xix, 80–81 assumptions 22 conflict 41–2, 58, 82, 96, 142 destructive confrontation 42, 128 corporate governance legislation 10 decisions 1, 20, 26, 32, 61, 76, 83, 96, 98, 100, 107, 143 decision-making in teams 16, 20, 31, 61, 76 facilitation 40–55, 115–32 co-facilitate 54 confidentiality 85, 131 consensus 79, 130 diverse 40, 54, 84 environment 86, 134 ground rules 85, 89, 95–6, 119, 128, 131 hidden agendas 85, 131 hierarchy 124 dominant voices 124 seniority 84 governance 61, 76 hamburger analogy 43–4, 57, 117 issues, confusion with risks 14, 44, 50, 60, 107, 133 145 A Short Guide to Facilitating Risk Management organisational culture and politics 32, 46–7, 50, 55, 61, 116, 120, 123, 131, 132–6 pitfalls 104–36 with applying the risk management process 104–14 when creating a culture where risk management works well 132–6 when facilitating 115–31 risk appetite 15–16, 123 attitude 21, 23–4, 36, 122–3 business-as-usual risk 108 buy-in 49, 134 capacity 15–16 definition, uncertainties that matter xvi, 14, 106 log, register 19, 30–32, 39, 64, 69–70, 72–5, 98, 100, 105, 113, 135, 142 modelling techniques 20 opportunities/upsides 11–13, 15–17, 28–33, 41, 63–5, 74, 109, 135 perception, triple strand of influences 22 risk averse 23–4, 122–3 risk neutral 23–4 risk seeking 23–4 risk tolerant 23–4 secondary 30, 70, 113 threats/downsides 11–13, 15–17, 28–33, 41, 63–5, 74, 109, 135 tolerance 15–16 risk facilitator 39–56, 137–43 development path 53–43, 118 engage, energise, challenge 59–60 framing 66, 99 risk specialist, necessary but not sufficient 58, 117 systematic bias, overcoming 60, 65, 67, 69, 71, 79–80, 85, 122–3 risk management benefits, measures 32, 34, 105, 134 culture 48, 50, 53, 61, 104, 116, 132 method(s), process(es), tool(s), training 7, 9–13 standards 11–13 risk management process 57–76 actions, intentionality 99 assessment 14, 19, 68, 114 chance, probability, likelihood 9, 18, 29, 66, 110–12 consequence, impact, effect on objectives 9–10, 19, 29–30, 66, 110–12 describe (cause-risk eventimpact), too woolly 17, 107–8, 122 follow-up, keeping it alive 30, 72, 100 identify 63 initiate, risk management plan 62 options thinking, prepare a plan B, contingent plan 27 146 index prioritise 65, 112 respond or response(s) 25, 70, 112 risk owner/ownership 26 risk workshops 77–100 attendees/participants 82, 87, 119, 124, 127–8 boring, not creative xviii, 58, 74, 117, 120, 132 face-to-face 5, 41–2, 62–4, 66–74, 92–4 frequency, number of 127 gather input, anonymous 92 going wrong 91, 121, 130 keeping people engaged 66, 121 purpose, big picture, why? 88, 118, 121 plan, objectives 83, 119 preparation, 81 virtual 5, 41–2, 62–4, 66–74, 92–3, 97 Team Development Model 94–5 147 ... Penny A short guide to facilitating risk management : engaging people to identify, own and manage risk – (Short guides to business risk series) Risk management Risk managers Industrial management. . .A Short Guide to Facilitating Risk Management C Taylor & Francis ~Taylor & Francis Group http://taylora ndfra nci s.com A Short Guide to Facilitating Risk Management Engaging People to Identify,. .. risk management as a natural human process If you reflect on what you and others naturally, it can help to find ways What is risk management? of making risk management successful in work and group