The Future of Risk Management is People-Centered

With the nickname “Risky”, it’s hardly surprising that Paul Chivers has a passion for workplace risk and safety. But his most recent experience as a risk adviser with the reality-TV series I’m a Celebrity…Get Me Out of Here! was on another level.

“We had a cast and crew of 400-plus in the South African jungle, with hippos, lions and snakes everywhere—basically everything that can kill you,” he says. “Then we pushed celebrities downhill inside 350-kilogram steel balls and had them swinging from hot-air balloons only 50 metres above the ground. It was a monstrous undertaking and while I loved the challenge, it really tested my ability to manage risk.”

Clearly, not every workplace faces the same trials but Chivers, who runs Riskfacilitator and is also an expert risk adviser with Safety Culture, believes the basic principles of risk management apply across all industries. “Risk management is just great business management,” he says.

“Risk management shouldn’t be about preventing risk taking, it should be about applying a discipline for opportunity, creativity and success. It should guide intent, process and practice, and create a level of due diligence and assurance that is proportionate to the exposure. It is about providing confidence to vested stakeholders. The greatest risk is to take no risk—this is our current threat.”

Sarah Gordon, managing director of Satarla risk consultancy and an expert with the Institute of Risk Management, agrees. Working predominantly with the mining sector across Australia, Europe, the Americas and Africa, she says risk management has moved from seeing risks as purely negative threats to balancing opportunities and threats.

“Businesses are beginning to understand what their risk appetite really is,” she says. “Conversations around the boardroom have started to focus on questions such as: What does zero tolerance really mean for our company? What does ‘as low as reasonably practicable’ really mean? And, at the end of the day, we should be talking about creating that safe environment, using risk management, in which people can actually work.

“It is generally about creating a platform in which people can really challenge their objectives and say, ‘Look, given a risk profile, can we actually achieve our strategy?'”

Seismic shift

Chivers also believes that the approach to risk in workplaces will soon undergo a pivotal shift. At present, most businesses maintain a keen focus on processes and systems. “You can have the best systems and processes in the world, but if no-one uses them you have nothing,” he says.

However, in future, risk management will be more people-centred. “It will actually be more about empowering an individual to have greater situational awareness and capability to make informed decisions,” Chivers says.

“There will be a greater focus on attributes that contribute to effective risk management. We will investigate the behavioural psychology of individuals as much as the risk itself. We will shift our attention from risks to evidence of control effectiveness.”

Allowing people to incorporate more independent risk assessments into their roles might seem radical. However, greater automation, reliance on technological platforms and more complex systems that react rapidly in the workplace is, somewhat counterintuitively, underpinning this shift.

“Although the systems will be better able to monitor themselves, the critical contribution of human insight will likely become more important yet harder to define and manage,” says Professor Mark Griffin, director of the Future of Work Institute at Curtin University in Western Australia.

Griffin believes that workplaces are changing rapidly, with big companies using more opportunities to centralise information while small companies are gaining access to technology formerly only available to large companies. Moreover, as workers and technology become increasingly intertwined—from platforms such as Uber to smart uniforms that track employee movement patterns—two major challenges will emerge for risk managers.

The first, Griffin says, is ensuring workers have the skills and vigilance to recognise problems that may be accumulating over time. But the bigger risk is the transition itself. “Ensuring stable systems while adapting to change is a big challenge,” he says. “The risk is in not understanding the consequences unfolding with the changing system, whether it’s on a mine site, a software platform or part of a transport network or hospital.”

Changing the template

While many workplaces have become adept at identifying hazards and dealing with them, there hasn’t been much by way of stepping back to re-evaluate. “We’re missing some fundamental questions because it’s all cut-and-paste risk and safety assessments at the moment,” Chivers says.

“There aren’t many people who take the time to actually explore the intent, process and practice for the management of risk. Who ask, ‘Why are you doing this? Does it actually assist people work faster, smarter, safer? Are we achieving objectives?’ We ultimately want to be able to make informed decisions and know that if we get it wrong or right, we have a plan.”

Gordon puts it simply: “You can’t feel like the process is going to save you.”

Chivers also believes that the types of people heading risk management needs to change. “We don’t have good teachers. We don’t have great mentors. We don’t have great influencers and that is what we need in the space.”

Moving away from a legal and compliance perspective is critical to improving risk management, Griffin says. “There has been a shift towards training people who are influencers with the interpersonal skills needed to understand work groups and engage them in problem solving,” he says.

The value of highly skilled communicators is hardly lost on Gordon. She made the move from geology to risk management because she had sat through so many dull risk workshops. “I thought, ‘Oh my goodness, there is a better way of doing this’,” she says.

“Now one of the most rewarding things is having people actually smiling, laughing and really contributing good ideas in a risk workshop.”

These interpersonal skills are critical to the success of future risk managers. “They need to be able to understand and analyse the data as well as what people are telling them,” Gordon says. “Then be able to synthesise and communicate that to whoever needs to know.”

But it’s not just about reporting upwards. “It’s being able to report back to all those people who have been gracious enough to actually give you the information in the first place, which I think risk managers sometimes forget about.

“Risk managers also need as much diversity as possible within the risk team, so you get the diversity of thought and internal challenge that mirrors what’s going on in the organisation.”

Leading the tribe

The risk managers of the future will ultimately be more guru than on-the-ground grunt. They may not need to sit cross-legged on a cushion, but they will need the charisma to inspire people to change their habits. “We need practitioners who create a tribe of followers who are fans of their risk managers—we need to guide the next generation of risk practitioners to be the superheroes in this space,” Chivers says.

“Imagine if all the risk people in the organisation had the philosophy of risk being an enabler. And instead of people going, ‘Oh, that’s the risk-and-safety person who is going to stop me doing something’, they’ll think, ‘That’s the risk-and-safety person—they’re going to help us get this over the line!’

“That is a massive shift in thinking but it’s what we need.”

Sarah Gordon’s Risk Workshop Tips

• Keep them short
• Have everyone standing the whole time
• Keep electronic equipment in the room to an absolute minimum
• Use posters, post-it notes and markers
• Listen to what participants are saying and gently guide the discussion
• Allow people to challenge one another
• If a manager is hampering discussion, find a way of diverting them to give all participants the freedom to speak

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