“Risk Management That Is Agile and Flexible For Emerging
And Unknown Scenarios”
Risk management allows organizations to prepare for the unexpected by minimizing risks and extra costs before they happen. Much of the risks and threats posed to companies in the past have come from financial uncertainty, legal liabilities, strategic management errors, accidents, and natural disasters. However, with the impact of the COVID-19 pandemic forcing the closure of businesses, remote working, and government-mandated national shutdowns of all non-essential services in many countries, businesses are now dealing with new and bigger threats.
AMCHAM T&T hosted a Webinar on “Navigating the Pandemic: The Usefulness of Risk Management” which was moderated by our H.S.E. Committee Chair, Ms. Cindi Nandlal, to provide vital information and additional resources that will help businesses and the wider society adjust to the health and economic fallout from the COVID-19 pandemic.
Nirad Tewarie, CEO of AMCHAM T&T said companies will have to begin investing more towards improving their risk landscape which is changing every day because of the COVID-19 pandemic. “We may have to perform more new risk assessments and continually adjust control measures to contain those new or heightened risks. So, we must come together and start developing practical solutions – if we haven't done so before – that will start looking more closely into our crisis management plans and business continuity plans in an era of COVID-19. We also need to re-think how we assess risk and prepare for events that could impact our businesses. Nassim Taleb – author of the Black Swan – is on record as saying that COVID-19 is not a Black Swan event as it was entirely predictable, yet many of us were almost totally unprepared to respond to it.”
“We understand that many companies are struggling to cope in these times due to the major disruptions caused by the response measures to stop the spread of the virus. The reality is that this virus is going to be with us for some time in the immediate future if there is no vaccine, but we also have to find safe and responsible ways to ensure that we can conduct and operate business during these challenging times,” Tewarie said.
Nippin Anand, feature speaker at the Webinar and founder of Novellus Solutions - a UK based company with world-class expertise in Human Factors and Safety Management Systems, argued that it is deeply problematic to think only in terms of errors when accessing risks and safety management policies. “There is very little value in looking at problems as errors, malfunctions, non-compliance, slips, and mistakes. We need to mature in terms of our language because this is where the safety science is taking us towards.”
Drawing insight from the real-life case study of the Costa Concordia accident – which claimed the lives of 32 passengers in 2012 when the ship capsized after hitting a rock off the coast of Giglio, an island on Italy's Tuscan coast – Anand reported that the crew was unwilling to speak up against the captain despite obvious warning signs that the ship had veered off course and was too close to the rocks.
Anand says in many situations when we push people to challenge authority it becomes difficult because we are not sure when the roles will be switched in the same space between the student and the teacher. “It is not just the captain. He is also the teacher. In certain cultures, and certain societies, we don't question the teacher. We don't quite understand these dynamics,” he says.
“We talk about leadership and accountability. Let's try and understand that when there is a significant gap between the captain and the subordinate, between the surgeon and his subordinate, between the pilot and his subordinate, between the trainer and his subordinates. What sense does it make to ask these questions?”
Anand says subordinates do not question authority because of the way society has organized the different roles and the value of the information that comes from the respective players. “From the perspective of the novice, he feels threatened. He feels very uncomfortable that whatever he says would make him feel exposed as somebody who doesn't understand anything, as somebody who's incompetent. And nobody is really making up anything. This is how we have organized these teams under very tremendous pressures.”
Anand argues that language plays an important role. “We should stop asking people to follow behavior-based safety and behavior-based tools. What is really needed is something more powerful and that is a shift in language. Language plays a very important role. So, people feel more comfortable talking about their adaptability and that is a very powerful way to influence the culture change. It is to give people a new language, a new way of thinking.”
“Today we have what you call reporting systems, that you spot something, and you report but they are very linear systems, they are very one-directional. The idea is to create systems of that thinking where we encourage that "two-way conversations", where somebody in a COVID situation sees something unusual and they can discuss this with the office and you can come up with a solution.”
Anand also said business leaders need to keep their focus on building a safety and risk management system that supports the outcome in relation to reality. “Business leaders should stop counting on outcome after an accident as a way to say that you are a safe or unsafe organization. In other words, stop counting on loss time incidents, casualties and breakdowns as a way to understand who is a hero and who is a villain. If you leave the outcome aside i.e. people getting hurt or injured, there is nothing really significantly different in a normal, average, successful operation and an accident.”
Meanwhile, Colonel Lyle E. Alexander, Chairman of the Port Authority of T&T says the future of risk management is dependent on companies becoming more encompassing and global in their learning, customer service, communications, medical responsibility, training (especially the soft skills) and with scenario planning and drills.
“What this pandemic has taught us is the risks that we face now literally can come from left field. There is no normal anymore and we are not going to go back to normal. So, we have to be constantly thinking if we want to achieve these business objectives, what are the possibilities and likely challenges that we will face down the road? Can we scenario them, and where possible, drill them?”
He says the Security Manager of the future needs to be more business-focused and solution-driven, creative and flexible, and consider taking the enterprise security risk management approach which uses risk-management principles to manage security-related risks across an enterprise.
In this period of COVID-19, he advises companies to establish a risk committee that is made up of all the necessary areas of the business, ensure that cybersecurity is a priority with so many people working at home, and not to take for granted the human component of the business i.e. their employees.
The “Navigating The Pandemic: The Usefulness of Risk Management” is one of a series of webinars that was envisaged and designed by the AMCHAM T&T HSE Committee to provide the necessary tools to help companies adjust to the disruption caused to business by the COVID-19 pandemic. AMCHAM T&T remains strongly committed to our members and the wider business community as we continue to work on your behalf through these challenging times.
For further questions or comments please contact: Nirad Tewarie, CEO AMCHAM T&T at firstname.lastname@example.org.
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