An Ounce of Experience is Worth a Pound of Speculation Maybe
Estimated Reading Time: 3 minutes
By Melanie Lockwood Herman
Executive Director
During last week’s Risk Management & Finance Summit for Nonprofits in Philadelphia, attendees heard a variety of messages about ways to consider and manage risk they encounter in their nonprofit organizations. Various themes were explored in plenary and workshop formats. One of the most powerful themes expressed in different ways from very different thought leaders was the reminder that experience offers powerful learning opportunities. As Paul J.H. Shoemaker once said, “Experience is inevitable. Learning is not.” Throughout the conference, practitioners from diverse organizations shared the lessons of experience, from managing parent-affiliate risks to alternative risk financing methods, developing policies, and the top legal risks facing nonprofits.
Keynote speaker Randy Park reminded us that experience is a key component of our personal filters. Our filters influence the way we see and act on the risks we perceive. Park noted that most of us treat our filters as facts, and fail to realize that our assumptions—rather than external or internal forces—may block us from reaching our goals. Park’s comments were a timely reminder that while experience can be beneficial in informing our perspective on risk, it can also cloud our view. For example, experience may lead us to believe that the future will be similar to the past and present. Yet an organization’s future may be dramatically different from the past.
Kenny Broad’s keynote included footage of his exploration of blue holes in the Bahamas. Still photos showed Broad face first in small-diameter underwater holes with a colleague gripping his ankle. He explained that exploring these small holes is a first step in discovering underground caves. At one point the audience at the plenary grew quiet as it watched a video clip of Broad swimming through several narrow openings in a small underground cave. At the conclusion of the plenary several attendees approached me to discuss their reactions. One attendee said she was inspired to try scuba diving and see the incredible world that exists under the surface of the sea. Another attendee told me that watching the video confirmed his claustrophobia.
While I continue to believe that experience is a powerful learning tool that can inform and shape thoughtful risk management, I’ve also come to recognize that the ability to imagine events that have never occurred before is equally important. As leaders of nonprofit organizations that exist in a changing and complex world, we must tap into past experience and look for wisdom, insight, and lessons we can apply in calibrating our risk appetite, managing our organizations in a world of risk, and inspiring staff and volunteers to sign on and sign up to help. But we also need to give ourselves permission to engage in blue-sky thinking about the future. And we must not limit our view of the future to a straight line path from the present. None of us knows how things will “turn out.” To be truly “prepared” and create resilient organizations, we must envision an ever widening range of possibilities.
Melanie Lockwood Herman is Executive Director of the Nonprofit Risk Management Center. She welcomes your feedback on this article and questions about the NRMC’s resources at Melanie@nonprofitrisk.org or 703.777.3504.
“First let me congratulate you on a conference well done. I had a great time at the Nonprofit Employee Benefits Conference and walked away with some valuable tools and questions that we’ll need to be addressing in both the short and long term. Thanks to you and your staff for all you do to provide us with quality resources in support of our missions.”
— Scott Brown, Mohonk Preserve
“BBYO’s engagement of the Center to conduct a risk assessment was one of the most valuable processes undertaken over the past five years. Numerous programmatic and procedural changes were recommended and have since been implemented. Additionally, dozens (literally) of insurance coverage gaps were identified that would never have been without the work of the Center. This assessment led to a broker bidding process that resulted in BBYO’s selection of a new broker that we have been extremely satisfied with. I unconditionally recommend the Center for their consultative services.
— Sidney Abrams, BBYO
“Melanie Herman has provided expert, insightful, timely and well resourced information to our Executive Team and Board of Directors. Our corporation recently experienced massive growth through merger and the Board has been working to better integrate their expanded set of roles and responsibilities. Melanie presented at our Annual Board of Director’s Retreat and captured the interest of our Board members. As a result of her excellent presentation the Board has engaged in focused review which is having immediate effects on governance.”
— Pamela Mattel, Basics Promesa Systems Inc
“The Nonprofit Risk Management Center has been an outstanding partner for us. They are attentive to our needs, and work hard to successfully meet our requests for information. Being an Affiliate member gave us access to so many time- and money-saving resources that it easily paid for itself! Nonprofit Risk Management Center is truly a valued partner of The Community Foundation of Elkhart County and we are continuously able to optimize staff time with the support given by their team.”
— Jodi Spataro, Community Foundation of Elkhart County
“The board and staff of the Prince George’s Child Resource Center are extremely pleased with the results of the risk assessment conducted by the Nonprofit Risk Management Center. A thorough scan revealed that while we are a well run organization, we had risks that we never imagined. We are grateful to know that we have now minimized our organizational risks and we recommend the Center to other nonprofits.”
— Marti Worshtil, Prince George’s Child Resource Center
Great American Insurance Group’s Specialty Human Services is committed to protecting those who improve your communities. The Center team has committed to delivering dynamic risk management solutions tailored to nonprofit organizations. These organizations have many and varied risk issues, hence the need for specialized coverage and expert knowledge for their protection. We’ve had Melanie speak on several occasions to employees and our agents. She is always on point and delivers such great value. Thank you for the terrific partnership and allowing our nonprofits to focus on their mission!