Most companies have risk management processes. And most teams follow these processes fairly well. Why is it, that with same risk management process, some teams succeed at avoiding big problems, and while other teams fail to do so repeatedly?
I am sure there are many reasons – but I have noticed one that is not often mentioned.
Failing teams have a culture of risk-avoidance. Successful teams have a risk-embracing culture. They are diametrically opposed – and it affects how they deal with risk.
Risk-avoidance cultures want the risk to go away. They want no risk to remain. They secretly believe that if the risk management process is done well, risk will actually be removed – even though they know that engineers are not perfect so this ideal is rarely reached. In these teams, risk management is a discrete task: something you do at select times in the project which, when completed, results in the removal of risk.
Risk-avoidance cultures say:
Risk must be eliminated – it should not remain on my project!
Risk-embracing cultures believe that risk is a fact of life. They expect it at any turn. They are comfortable with risk. They learn to love looking for risk. No matter the mitigation plan – they reason, something can always go wrong – so they keep planning for it. Risk management is a continuous affair – almost a state of mind.
Risk-embracing cultures say:
Risk is part of our life – we expect it and use it to get better
In my experience, no team is purely risk-avoidance or risk embracing. These are opposite poles of a spectrum – the team tends towards one or the other.
I have learned to identify the dominant behavior (avoidance or embracing) by looking for telltale signs of how the team reacts when risk becomes an actual problem (i.e. it was not avoided).
| Risk-Avoidance Cultures |
Risk-Embracing Cultures |
| When a problem occurs: | When a problem occurs: |
| First thing they do is ask about, and then measure, the impact when things don’t go according to plan. | They already know the impact since the problem was identified as a risk. They study how the mitigation plan failed – as a learning exercise. |
| They attempt to coerce things back to original plan, keeping every task as is – as much as possible. | They throw out the old plan. They often have a new plan ready already. (note: milestones don’t move though). |
| They look for the cause: why did this happen. This leads to finding a culprit to blame. | They award praise to the person who identified the problem,they celebrate what was learned. |
| They demand an increased frequency of reporting - to make sure the plan stays on course from now on. | They increase their confidence in their ability to deal with risk, as they learn to better mitigate over time. |
| They become experts at doing things exactly the same way. | They becomes expert in innovation. |
| They maintain the same level of proficiency at handling risk. | They get better and better at handling risk. |
A warning: Do not confuse risk-avoidance with risk-adverse. They are two different concepts. I know many successful entrepreneurs who are clearly risk-embracing and yet are very risk adverse. I also know team leaders who are in the risk-avoidance camp but are reckless risk takers.
Engineering teams do well in a risk-embracing culture. It is the nature of engineering work that we cannot predict everything. Evolving an approach that always looks for what can go wrong, understanding the source of the potential problem and creating adaptive mitigation plans requires great engineering skills. It’s actually challenging and fun.
