Riblet#4: Risk assessment – there’s more than one way

(Riblet: a risk management morsel. From NIB – news in brief, and niblet – a tasty morsel. Riblets are also the ridges on a shark’s skin that enable it to swim faster).

The Mind Palace is an ancient memory system made popular not long ago by the UK TV series Sherlock. The idea is that you remember things by placing them along a route around a house, or villa, or any journey you regularly make e.g. a run, or a round on a golf course.  Placing the items along the route in your head helps you recall them later.  The idea has also been adapted to provide a framework for problem solving and other similar mental activities.

Xanadu was the fabulous marble summer palace of Mongol Great Khan and Chinese Emperor, Kublai Khan.  It become synonymous with sumptuousness and beauty from the writings of Marco Polo who visited it, through Samuel Taylor Coleridge’s opium-fuelled poem: “In Xanadu did Kublai Khan a stately pleasure dome decree”, and countless other cultural references from Citizen Kane to Frankie goes to Hollywood.

Xanadu and the city that grew up around the palace in the 1260s were constructed in strict accordance with 5,000 year-old feng shui principles that are intended to ensure, harmony, happiness and success.  The principles ascribe attributes to the eight points of the compass, e.g. the south-east section of a building relates to wealth and money which is why most Chinese restaurants have the cash register in that section of the restaurant, and also a fish tank there to ensure positive energy.  The compass is used in octagonal form (you draw an octagon over the plan of your house to read the feng shui)  and the attributes for each compass direction are listed below. The compass was invented in China around 5,000 years ago for purposes of feng shui, and around 2,000 years later, someone realised that it was also quite useful for navigation.

For our purpose, the attributes form a framework for questions that facilitate a risk assessment, and you just go round the compass directions clockwise from East all the way around to North-East, addressing the questions related to each attribute.  Let’s assume it is a risk assessment of a project.

East: Knowledge – What are the issues that the project addresses? What is the project trying to achieve? What assumptions are we making about the problem and the solution?
South-East: Financial aspect – What are the financial benefits of the project, What might undermine them? What is the likely cost of the project and the pay-back period?
South: Reputation – How will the project enhance the organisation’s reputation? How might the project damage the organisation’s reputation?
South-West: Non-Financial aspect – What are the non-financial benefits of the project? What problems/annoyances is the project intended to remove?
West: Experiential aspect – What are the benefits to customer/colleague experience?  How might it worsen customer/colleague experience?
North-West: Change – What are the specific changes that are being implemented? What is the impact of the changes that are being implemented on the parts of the organisation that are taking them on board?
North: Relationships – How will the project affect suppliers? How will the project affect customers? How will the project affect investors’ interests?
North-East: The longer term – Looking forward 5 years, what change will have been produced? How are future customers affected by the project?

The answers to these questions should bring out the key risks related to the project. You can apply it equally to a strategy or to a process.

Data SourcesPig Wrestling – Pete Lindsay & Mark Bawden, Kublai Khan: The Mongol King who remade China – John Man, Feng Shui for Beginners – Richard Craze

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