VUCA is an acronym for Volatility, Uncertainty, Complexity, and Ambiguity. VUCA is the driver of most disruption in business.
I believe we live in VUCA time. And, VUCA is changing how business is done: [Read more…]
Living in VUCA Time
on Risk & Safety
A listing in reverse chronological order of articles by:
- Greg Hutchins (editor) — CERM Risk Insights series
- Doug Lehr — Equipment Risk and Reliability in Downhole Applications series
- Sanjeev Saraf — Operational Risk, Process Safety series
#2 Best Job — Risk Manager
“One Thing is Certain: 2017 Will Be the Year of Uncertainty for CEO’s’”
Shouted a recent Wall Street Journal article.[1]
Why?
Let’s look at the reasons at why we live in VUCA time (Volatility, Uncertainty, Complexity, and Ambiguity).
- President Trump is disrupting business rules and business models.
- Technological change is increasing.
- Mass immigration is resulting in political divisions.
- Climate change is real and increasing.
- Globalization benefits are unclear due to job and work transference.
Critical Success Factors for Risk Based Thinking
The critical success factors for ISO 9001:2015 RBT are much like Six Sigma and lean. Our hard lessons learned over the last dozen years migrating organizations from quality to ERM include: [Read more…]
How to Work with the Chief Risk Officer
Many CRO’s come from compliance, legal, or finance areas. They do not know operations or quality. This person is critical to quality‘s success with ISO 9001:2015 in terms of providing risk approvals, direction, and resources. The quality department should be flexible and work with the CRO, specifically: [Read more…]
What is Risk Based Thinking?
We get this question weekly and sometimes daily it seems.
Why? ISO has not defined Risk Based Thinking? And, this is a hugely important question because ISO has elevated RBT to the same level as PDCA and Process in the Final Draft International Standard (FDIS) of ISO 9001:2015.
One of the things we know is the marketplace hates a vacuum. Someone will develop a product or service to fill in the vacuum. This is exactly what we did with RBT. [Read more…]
What is ERM?
What is Enterprise Risk Management (ERM)?
ERM is a relatively new concept. There is a robust discussion among experts what it really means. Common ERM elements in most definitions include: [Read more…]
Risk Assessment Challenges
We have conducted hundreds of risk assessments in a number of sectors from homeland security to pension funds to Parks and Recreation departments. We have a number of hard lessons learned. These are some common mistakes we have made and seen: [Read more…]
ISO 31000 as an Enterprise Risk Management Standard
ISO 31000 is 23 pages long, but these pages provide an entry level Enterprise Risk Management (ERM) guideline.
Why is this important?
An organization develops ISO 31000 ERM capabilities to provide a structured, consistent, disciplined, and achievable approach to risk management that facilitates Risk Based Thinking throughout the organization. Risk Based Thinking is composed of 1. Risk based, problem solving (RB – PS) and 2. Risk based, decision making (RB –DM). Both RB – PS and RB – DM are the basis for all management and supervision. We discuss this in our new book: ISO 31000: Enterprise Risk Management.
Interestingly, we wrote a 230 page book packed with loads of information for a 23 page standard. And oh by the way, we could have written another 200 pages. [Read more…]
Risk Assessment Benefits
Risk assessment is a critical element of ISO 31000 risk management framework. Risk assessment provides the requisite evidence based data and information for Risk Based Thinking, specifically risk based problem solving and risk based decision making. Using the appropriate risk assessment for the organization can determine how to treat and manage specific risks. [Read more…]
ISO 31000 Challenges
ISO 31000 is going to be used more often as more ISO certified companies adopt Risk Based Thinking. However, ISO 31000 can be challenging. Why?
Interestingly, the descriptive nature of the ISO 31000 standard may well be its strength, but may also be its weakness. The standard without the proper guidance of a risk practitioner maybe come discretionary and even arbitrary.
ISO 9001:2015 has Risk Based Thinking requirements. Note ISO 31000 was developed in 2009 and is not harmonized with the new annex SL standards and ISO 9001:2015. [Read more…]
What is Risk?
Risk is an interesting concept because there are a number of definitions and interpretations. And this bears on quality because the lack of consistency can make deployment difficult.
Two elements to risk can be seen in the below definitions. There is upside risk and there is downside risk. Some risk definitions have this and others don’t. [Read more…]
Retaining Knowledge to Reduce Risks
Guest Post by Umberto Tunesi (first posted on CERM ® RISK INSIGHTS – reposted here with permission)
Mens Sana in Corpore Sano (A Sound Mind in a Sound Body).
It could also be translated that quality of life is more important than the span of life, the number of years you live.
Or that medicine’s task is not to add years to your life but the life to your years.
And it might also be that such a formula for life – originally a Juvenal’s wish or prayer – is much more ancient than its Latin transcription. [Read more…]
Why Don’t We Listen?
Guest Post by Umberto Tunesi (first posted on CERM ® RISK INSIGHTS – reposted here with permission)
Or, why we are not listened to?
Why don’t we listen to those who – justifiably – cry wolf?
Be others or ourselves, it does not matter.
The output of this regrettable way of thinking often results in a “chronicle of a death foretold”. What do I mean? [Read more…]
Are You Managing Risk or is it Managing You?
Guest Post by Paul Kostek (first posted on CERM ® RISK INSIGHTS – reposted here with permission)
You’ve completed your project’s Risk Management Plan and now you can move forward with project execution because all of the project’s risks have been identified what can go wrong? Well plenty. It’s easy to get caught up in weekly (daily) reviews of the identified risks, tracking status (are the boxes going green, yellow, oh no red?). [Read more…]
Unaddressed Risk
Guest Post by Paul Kostek (first posted on CERM ® RISK INSIGHTS – reposted here with permission)
What’s the risk of not addressing a risk? What happens on a project when a risk is identified and not addressed/mitigated? There may be reasons not to correct it, e.g low probability of occurrence and minimal impact, but how do we document and track this decision? And if we’re delaying an implementation how do we insure the risk is addressed at a later date, e.g. next version release? How do we insure that if an audit takes place the project team can clearly explain the reasons for the decision? Is this even acceptable? [Read more…]
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