Risk management challenges #3: Data quality
As a risk management coach I see first hand some of the challenges organisations have when it comes to risk management. Many of the challenges are recurring and seem to be present regardless of times and trends. Other challenges come with changes in standards and expectations from stakeholders.
A challenge that will never cease to exist is the lack of good or sufficient data. In risk analyses, no matter how we look at it, we are somehow trying to predict the future. We do this because we think that if we understand what the future holds, we feel that we can control it. Further on, the feeling of control supports our certainty that we can better protect the values we manage and ensure we produce good results in our businesses.
In some instances, for example in a production line, or in a process with many repetitions and little variation in execution, we will be able to collect data about performance, non-conforming outcomes and the types of incidents that might occur. Based on such data we will be able to understand more of the uncertainty spectrum in our process, and by that we can be able to produce statistics and project assumptions about the future into our risk analyses.
However, in many organisations, processes are performed on irregular basis, with a certain variation, because the production and services provided vary. Take for instance an organisation that provides road construction services. Each location and each project will entail different requirements. The ground conditions might require different approaches, the weather conditions might introduce different risks and different clients might have different requirements to how to perform the work.
On the same note, a health service provider will have the same challenge. Each patient will be different, both when it comes to psychological needs and physical needs. Each nurse will have a different effect on the patient as well as having slightly different techniques for performing different practical tasks. In instances such as both construction services and health services, getting data which has the quality needed to project future incidents, will prove difficult.
Based on this it is safe to say that performing a risk analysis of a construction site or a health service department where the variables are unlimited is different from the example with the produciton line. In the production line you can be more certain that the quality of the data you put into the risk analysis will give you information, which to a high degree may be projected intor valid assumptions about the future. The three scenarios require different approaches both in assessment technique and in communication to decision makers.
From my experience, the challenges with data quality are difficult to erase completely from the equation. However, I have found a few techniques that have worked for me in the environments I have experience from. Firstly, I focus very much energy into creating a facilitating ambience in risk meetings. By priming the group to being open, creative and reflective I find that more information is brought to the table. You can read more about facilitating and executing risk meetings here.
Secondly, I chose to rely on experience and professional expertise, allowing and encouraging people closest to the risk to share their thoughts regarding specific risks in detail. This means that I do my best to have the group accept that we may have to spend more time to actually understand certain risks.
Thirdly, my focus is always on open and correct communication to decision makers and stakeholders. It should be a given that details regarding the criteria for analysis, and the quality of the data and knowledge concerning a risk are described. Also, it should be possible for decision makers to establish an understanding of how challenging it was to understand the risk. If the group had to use extra efforts to understand the risk, decision makers should be able to use this information to support their decion making. So, if the group had contradicting data, or if there were disagreements about the risks level in the group, decision makers should be informed and allowed to make up their own mind.
I am sure you can recognise my focus points, yet have different perspectives. My focus points are based on the experiences I have, and the organisations I’ve been part of, as well as my own personal preferences. Your perspective has equally been developed during your years of experience in the field, your background and the cultures you have been working in.
When I hold courses and risk management training events, I find that the most useful part of the courses often are the parts where we are able to, as a group of equals, have an open discussion and share our experiences related to a specific topic. For about a year now, I have been wanting to do something different from my classroom courses. In May it will finally be a reality:
You are hereby invited to participate in my Mastermind session in Alicante from 22nd to 25th of May. I have called it Risk-based thinking, for quality and risk management professionals, and my objective is to create a space where we can meet and openly discuss specific challenges we have in our day-to-day work related to risk management, and pick each others brains on ways to improve and better approach our individual challenges.
The goal with the Mastermind is that each participant can go home with a well proven plan for handling challenges they’ve brought to the table during the Mastermind session. The expected bonus is that we all end up with a widened perspective on how we conduct our work and how we can improve our value for our organisations.
During the Mastermind we will use four main approaches:
Hot seat – all focus is on you and your challenges, until the group understands the specifics of your situation and your goals.
Theory – I will prepare theory sessions based on the topics and challenges you are interested in working with. We will use these sessions as a base for discussion, but not as something to comply with.
Peer support – working in smaller groups to outline specific plans and solutions will support each participant in getting the expected value from the Mastermind.
Networking – it has been scientifically proven that we work better in teams when we have a relation to, and develop trust towards our peers. Food and wine will be provided. :)
You are welcome to join me in Alicante!
I will be creating a few posts about the Mastermind: Risk-based thinking, for quality and risk management professionals in the coming weeks. Each post will discuss different challenges I experience that my peers have in their work with risk management, and in each post I will reward anyone who comments with a 10% discount on the Mastermind, or on any of my risk management coaching services. The offer is valid until 31st of March 2018. If you’re not comfortable with commenting here, please feel free to send the comment to my e-mail.