By Melanie Lockwood Herman
The subject of “being late” has a starring role in literature, popular music, and every day conversation. Despite the fact that we spend a lot of time worrying about being late, we often wind up behind schedule. Many tasks and journeys take longer than first anticipated. As a result, we apologize for arriving late, we express regret for hours-long delays in replying to email messages, and we seek forgiveness from dinner guests when the recipe we have prepared is served long after the announced meal time.
When we arrive, sign up or sign on late we sincerely hope that “better late than never” applies, although from time to time we aim to be “fashionably late.” We attribute unintentional lateness to traffic congestion, overloaded circuits and servers, slow-moving family members and the occasional dead mobile phone battery.
In organizational life it is rarely, if ever, “too late.” Whether your nonprofit is growing, stagnating or winding down, there is (almost!) always time to revisit and upgrade the way you are approaching the risks you face.
In their book titled “Surviving and Thriving in Uncertainty: Creating the Risk Intelligent Enterprise,” authors Frederick Funston and Stephen Wagner review some of the challenges that emerge in traditional risk management efforts. These challenges include the need to:
- Change the way the organization views risk and reward;
- Improve the transparency of risk management for the board and other stakeholders; and
- Develop “repeatable and sustainable” skills, processes and tools for risk identification and risk management.
As I reflect on these challenges I’m reminded that it’s never too late to broaden one’s perspective on risk and explore new ways to fine tune the risk treatment skill set. I invite you to:
- Explore how the leaders of your organization view the concepts of risk and reward. Is there a shared view of appropriate (and inappropriate) risk taking within the board? Among the board and staff? If not, what steps are in order to cultivate a shared view of what constitutes the “right risks” and an appropriate appetite for risk taking in the short and long-term? How will the board and staff adjust or calibrate their shared view as circumstances (and the organization) change over time?
- Take a close look at how (and how generously) you share information with key stakeholder groups. To what degree is your organization embracing the call for greater transparency? What insights about risk are you “holding back” or keeping “under wraps” that ought to be shared? What are the potential upsides of sharing and the downside risks of keeping information and awareness out of sight?
- Examine your strategies for building organizational capacity to effectively anticipate the future and manage risk. If you’re relying on the “same old” ways of thinking about risk (e.g., the possibility of injury or property damage), you may be missing the risks inherent in critical dependencies, the intersection of events and circumstances beyond and within your control, and subtleties such as the speed with which things can go from bad to good or bad to worse.
Great leaders have more questions than answers, and leaders of great nonprofits refuse to be satisfied with dated assumptions about the capacity to cope with uncertainty. I encourage you to look far and wide for opportunities to polish your risk-taking and risk management skills. Commit to broadening your perspective on the world around you and the risks that exist under your nonprofit’s shiny exterior as well as those on the horizon. And I promise it is not too late.
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.