Risk Management case studies and how to use them

Risk management case studyCase studies, for as long as man could communicate, have been used to educate and explain. In its simplest form it might start with the line, “Have you heard the one about …”?

The reason case studies are so effective as communication and education tools is that they tell a story and through that telling, they provide a real example for the principles of a topic to be explained and they allow discussion and analysis. It is much more difficult to use theorems and definitions to get the same result.

So, using a case study in risk management training offers an excellent opportunity to bridge the gap between risk management principles and risk management in practice.

As an example, say you want to explain the definition of risk, that is, ‘the effect of uncertainties on objectives’. A case study might be of an organization which is cutting corners in relation to safety in order to achieve production objectives. The outcome could be an increase in injuries or, worse, a fatality. Examples of these situations appear in the newspapers and often in court proceedings almost every day.

A framework for using case studies in risk management

These need to be presented like a good narrator tells a story. A perfect example can be found in the training video called Piper Alpha – Spiral to Disaster. The basic framework looks like this:

1. Set the scene

  • Describe the organization – its structure, general performance, any particular pressures eg growth or market.
  • Describe the situation, the background to the story.
  • Describe any other organizations involved – eg contractors, suppliers, customers.
  • Describe the people involved – their roles and actions.
  • Include any other information necessary to understand the case study, such as any other complexities or issues in the work environment impacting the situation.

2. Tell the story

  • Give an account of how the event was triggered, what happened, when it happened and what were the outcomes.
  • Use a time line to best present the sequence of events and any overlaps.
  • Use examples of documentation such as project plans, budgets, memos, data gathered.
  • Use anything visual – still photos, video, drawings, and cartoons – anything that helps to tell the story.

3. Do the analysis

  • Prepare an analysis of the event and why it succeeded or failed.
  • You may decide to provide the analysis for discussion or to have participants do their own analysis, perhaps as a group exercise.

Case studies are especially useful in short duration risk management courses as they can communicate complex issues in a short time.

The other major advantage of risk management case studies in course such as those on ISO 31000 is that learners can recall case studies and the lessons learned, much more easily than they can recall definitions or concepts. On top of that, people will generally always remember images rather than text.

7 Steps To Developing A Risk Management Plan

Risk is real for any company or organization. Don’t kid yourself. Things happen when you least expect them to happen. Are YOU ready for the unimaginable, the unexpected, the unwanted? As an executive, have you put your head in the sand around risk? Do you pretend that all is well, and nothing will change? If so, it’s time to face reality: data gets lost, buildings burn, people resign. When any of these occur, your organization is at risk for malfunction, inefficiency, chronic struggle, revenue loss, and even total failure. Is this the path you want to go down?

Risk Management Plan

Beginning now, you can initiate the process of developing your organization’s risk management plan. Take charge. Form a committee representing Board members and staff, and ask them to partner with you to create this critical document. Make sure everyone understands the importance of the work, and explain to them how they can benefit from contributing to the finished product. Risk managements plans are not optional; they are essential for every company, large or small. There are no valid exceptions.

Implement the following seven steps in your risk management plan, and give yourself and others a huge slice of peace of mind:

1.  Define what risk looks like for your organization.
What constitutes risk in your shop? Threats to normal operations? Threats or compromises to people’s safety? Loss of physical and electronic property? Loss of revenue? Decreased public/community support? Unethical behaviors?   Create a comprehensive definition of risk that means something to YOU and YOUR organization.

2.  Identify specific risks.
Ask the committee to brainstorm as many different risks as they can possibly imagine. Record them on a white board or flip chart. Examples of various risks include: firing of the chief executive, dwindling interest in one of your major products, departmental silos, Board infighting, inability to fundraise, economic downturn, layoffs, building fire, computer crashes, philosophical differences between key employees, extended leaves for managers, interruption in receiving necessary supplies. All of these are potential risks, and there are many others. Continue brainstorming until the group believes they have come up with an exhaustive list.

3.  Categorize each risk.
Determine category names for the identified risks. Examples may be: Chief Executive, Board of Directors, Physical Property, Technology, Data, Employees, Products or Services, Customers/Clients, Stakeholders,. Place each risk under one of the selected categories. Create as many category names as you need.

4.  Rank each risk according to severity or significance.
Choose headings such as “most severe”, “moderately severe”, “of minimal concern”. You don’t have to use these same words for your headings, but be sure that your phrases adequately differentiate between the degrees of seriousness. Perhaps you would like to color code each risk according to its significance heading: red for “most severe”; black for “moderately severe”, and green for “of minimal concern”. Set it up the way it best works for you and your organization.

5.  Develop strategies for reducing or eliminating each risk.
Begin with the risks under your “most severe” heading. It’s critical that you don’t delay in thinking through possible solutions for those major issues. Ideally, determine multiple strategies for each risk. Be sure to consider who within the organization is going to be responsible for implementing the various strategies, and the resources needed to implement them. Omitting this information from the plan only causes big problems later.

6.  Write your plan.
Using all of the above input, shape a readable document. Practicality is paramount here. The plan is worthless if nobody can follow it, interpret it, or actually rely on it as a guide during crisis. After it is compiled, seek feedback from the committee as well as other employees and Board members. Incorporate changes where indicated. Check for evidence of common sense throughout the document. Hold yourself accountable to a high standard around common sense. A pie-in-the-sky risk management plan doesn’t serve anyone.

7.  Test some of those strategies in your plan for viability.
Do they work? Can they work? Why or why not? Where are the pitfalls? What steps are missing? Would you benefit from having certain outside experts review your strategies? If so, which types of experts?

Revisions to the plan may occur annually, as situations arise and your organization lives one or two of the strategies firsthand. Hindsight is often wiser. Don’t be afraid to toss some plan content when you know for a fact that this is what you must do. Remember: the plan needs to be current. On a day you least expect it, someone has to grab that document, refer to a particular section in it, and act upon it–fast.

Sylvia Hepler, Owner and President of Launching Lives, is an executive coach/advisor based in South Central PA. Her ideal clients are corporate executives, nonprofit executive directors, and business owners who demonstrate commitment to getting unstuck and creating a NEW story for their lives. Ms. Hepler’s background includes: teaching, public speaking, retail sales, freelance writing, and executive leadership of a 14 county nonprofit organization. She has a working knowledge of staff supervision, Board development, Quality Management, SWOTT Analysis, the hiring and firing of employees, mission/vision development, networking, and organizational collaboration. Her no nonsense approach coupled with heart yields swift results with most clients.
Article Source: EzineArticles

Risk Management – Safety and Design Considered

There are all sorts of OSHA standards, and I don’t recommend that you break any – however, sometimes OSHA standards in certain circumstances can create unsafe situations.

The reality is that you need to keep your business model and processes within the boundaries of OSHA law to prevent lawsuits, and regulatory fines. Nevertheless, let me explain to you one case study and example, something in my own company prior to retirement which always bothered me. We used pressure washers and steam cleaners to clean fleets of vehicles under contract.Risk Management Case Studies

We would wash Rent-A-Cars, company fleets, school buses, post office jeeps, patrol cars, car sales lots, and trucks for trucking companies. When you use a pressure washer over 2500 PSI you are supposed to use a long wand with a 15-degree or greater tip on the end. This allows the water to spray out in a fan so you don’t cut your finger off. That makes sense right? Sure it does.

However, we found that often times school bus yards had school buses parked way to close together. In doing this you could not clean them with a long wand and maneuver between the buses. And if you tried often the wand would catch on this side of the bus, and it would jab the gun into your body. Not good. Especially when it was cold out with ice, or when there was diesel fuel that had leaked on the ground.

That is an accident waiting to happen. Therefore, it made sense to move the buses out to an area where they could be cleaned. Of course trying to get in between buses, and open the door of the engine compartment to start them up, and bleed the system, could have the door coming back and sandwiching your head, while you were on slippery ground. We chose the lesser of two evils and shortened the gun wand length for safety. By doing this we never had another accident. I believe this is a good risk management case study. Even if we technically violated OSHA rules, safety first I say. Think on it.

Article Source: EzineArticles.com

Follow

Get every new post delivered to your Inbox.