Replying to LO28698 --
Alan wrote:
> I'm sure the answer to the problem of implementing permanent change in
> organisations can be answered by a systematic risk management approach.
> I read somewhere that the success of America compared to other nations
> lies in it's companys' excellent risk management, and from what I've seen
> I believe this is true.
What you sense about U.S. management taking an interesting look at risk is
borne out in my experience over the past few years.
About four years ago I was on a team of training program developers who
came from Babson College, the Center for Quality of Management,
Haemonetics Corporation, Harvard Business School, and the U.S. Navyıs
Underwater Warfare Center. For 18 months we labored over how to improve
the management of decision risk. We wanted a process which would allow
strategic leadership to find, target, and capture high return
opportunities in today's typical environment where information explodes
into our consciousness, and time constraints shorten the decision making
window of opportunity.
Here are some examples of what I mean:
New Product Risk: Your newest product is doing better than expected.
Unfortunately, it is also disrupting manufacturing for other core
products, and technical service cannot keep up with field service demands.
Managing Uncertainty: You're racing to make a strategic acquisition and
the price is based upon rapidly harvesting operating synergies. You've got
to pull this off without losing market share, but the level of change is
enormous.
Adapt or Die: The market is changing and you must implement a significant
new business model. You've been successful, but now you must adapt quickly
to survive.
Back Against the Wall: Last year's opportunity is this month's problem
about to become a crisis. You've got to make some quick changes but your
alternatives look ugly.
Tough and urgent decisions could have serious or unexpected consequences.
They don't have to be made on gut feel. A company can develop the skills
to rapidly manage risky decisions. The team I enumerated above developed
the ARMED method to help an organization rapidly understand the impact of
strategic decisions on all operations. It creates the models to predict
outcomes and build the countermeasures to prevent unintended and
undesirable consequences. The final outcome is: minimized risk and higher
returns.
The several stages of this tool rely in part on a series of "expansions"
and "contractions", or, better stated, on divergent, then convergent
thinking. Some of the methods within the ARMED method are:
Decision Scope Tree Diagram
Lens and Rating Grid (a wonderful tool to identify important perspectives
and understand their genesis. This develops a breadth of understanding)
Root Cause Analysis ("5 Why's")
Causal Loop Diagrams
Pugh Matrix for generating and evaluating alternative decisions
I believe our host, Rick, has stored an article I wrote about this which
appeared in the Spring 2002 issue of the CQM Journal.
[Host's Note: That article is at:
http://www.learning-org.com/docs/0205_Mallis_MDR_Article.pdf
.. Rick]
Let me know if you have thoughts or questions.
Best regards,
Barry
--Barry Mallis The Organizational Trainer 110 Arch St., #27 Keene, NH 03431-2167 USA voice: 603 352-5289 FAX: 603 357-2157 cell: 603 313-3636 email: theorgtrainer@earthlink.net
Learning-org -- Hosted by Rick Karash <Richard@Karash.com> Public Dialog on Learning Organizations -- <http://www.learning-org.com>
"Learning-org" and the format of our message identifiers (LO1234, etc.) are trademarks of Richard Karash.