Risk management is about achieving objectives whether it be the objectives of a process, a project, or a department of a business. At the enterprise level it is about achieving an organisation’s strategic objectives. Often, the risk assessment of those strategic objectives focuses on what could go wrong, what risks might crystallise and mean that the objectives are not met. But it should also be about understanding the risks the organisation is actively taking in order to reach its goals (think: which actual actions create value or provide a return?), and that means continuously and consciously taking those risks and monitoring that the risks are being managed to an acceptable level.
The American Civil War (1861-1865) was marked by caution on both sides for most of the war. The Confederacy had seceded from the Union, precipitating the war, but those eleven southern, Confederate states really only needed a stalemate rather than outright victory in order to achieve their goal of separation from the northern states of USA. Stalemate would force negotiation and settlement of the issue. The Union on the other hand needed victory in order to bring the southern states back within the fold, and for much of the war it was not getting anywhere near that objective.
Enter Ulysses S. Grant. Immediately before the war he was a drunk and a bankrupt, dependent on family charity. When the war broke out, he volunteered to drill troops in his home town in Illinois (he had been a quartermaster in the army during the Mexican War of the late 1840s); three years later he was overall commander of the Union forces; eight years later he was President of the United States.
Grant did two things. Firstly, he freed the northern army from dependency on supply lines by having it live off the land – this enabled a freer range of action and faster movement (this was covered in an earlier riblet on dependencies). Secondly, he told his commanders to pursue the objective ruthlessly, to get behind the enemy and to follow them wherever they went. President Lincoln approved the approach, but warned that it would not work unless he “watched it and forced it every day and every hour.” Grant was already doing that and more. He never let go of the goal. If a commander said that a Confederate fortress could not be taken, he would replace the commander, and keep doing so until he found one that could take the fortress. Grant’s persistence led the Confederate commander, Robert E. Lee, to realise that he was beaten, and he agreed to surrender to avoid a bloodbath.
How often does your organisation repeat its goals to all colleagues? How frequently does it monitor progress on achievement? How frequently does it ensure that the risks that are being actively taken to achieve its goals are being properly managed? And is all that done every day as Lincoln advised?
Data Source:The Personal Memoirs of Ulysses S. Grant (1885)