Change management is an important adjunct to risk management as it can limit risk exposure.

Risk management (contingency planning) involves understanding and planning for any number of possible negative scenarios. Identifying potential risks early and then developing appropriate strategies can prevent or mitigate negative impacts.

The source of risk can be external or internal:

• external – anything outside your organisation’s influence like challenges, e.g., geo-political, industry, technological, socio-economic, etc.
• internal – anything inside your organisation like staff, work conditions, skill levels, business model, products and services, etc.

Two approaches to change management can help evaluate and handle risk:

1. Tangible or analytical competencies – include techniques like Porter’s 5 forces, value chain, PESTLEC, SWOT, life-cycle, scenario planning, benchmarking, VUCA, and more.
2. Intangible or people competencies – include the understanding of soft skills like behaviours, motivation & persuasion, emotional intelligence, neuroscience (how the brain works), evolutionary psychology, human instincts, resistance, cultural issues, communications, creativity, mindsets, biases, beliefs, values, co-designing, humans as social creatures, leadership, collaboration, alignment, etc.

Of these 2 approaches, the intangible is often neglected yet it is very important: research has indicated the people elements of change management contribute around 70% to the chance of success. However, only 3% of investment is typically put into the people side of change management, with the rest going into tangible areas (Prosci, 2022).

In business, awareness of the interplay of change and risk management is a vital advantage.

“…risk mitigation means getting on with it and not missing opportunities. In today’s world, not adapting fast enough is the greatest risk…” (John Kotter et al, 2021)

For more detail on this topic, try visiting the online knowledge base for organisational change management here:  https://www.billsynnotandassociates.com.au/knowledge-base.html)

Last week I wrote a short piece on ‘what a risk assessment is’; This week’s follow up is all about how to do a risk assessment for yourself because, as we all know, every organisation/business should have a risk register, especially in these turbulent and unprecedented times.

There are many guides to ‘How to do a risk assessment’ but the basic steps are as follows:

1. Identify potential risks/hazards
2. Identify who or what may be impacted by them
3. Evaluate the likelihood and severity of each risk/hazard identified (in point 1)
4. Implement controls to reduce or eliminate risk/hazard
5. Review & re-assess your risk assessment register

The risk assessment process should consider internal and external hazards and risks. Many risks for an organisation  have an external focus. It is common for a business to be impacted by third party suppliers for example.

It is important to document your assessment in a register for reference and communication as well as for reviewing and updating – it’s not a set and forget exercise! The register should include who is accountable for the management of any particular risk and regular reports should be provided on the state of the risk; ie whether it is reducing or increasing.

Identifying risks/hazards

Sometimes easier said than done but the key to identifying risks and hazards is consultation. Talk to staff and service providers, take a walk around your premises, review previous accident or Ill-health records and any manufacturers’ recommendations for goods-handling or storage or machinery operations. And use third-party data, such as insurance contracts, to provide information and ensure your processes are rigorous and comprehensive.

Identifying who might be impacted

Different groups can be impacted differently by the same hazard or risk. For example, pregnant women would be more at risk from exposure to, say, radiation than other groups; Employees on site might be more at risk than contractors visiting. So, identifying categories of ‘at risk groups’ becomes critical to evaluating the severity of a risk and the controls you choose to mitigate or eliminate risk.

Evaluating the likelihood and severity of each risk/hazard

In a nutshell, any assessment will basically evaluate how likely it is for a risk/hazard to occur and how severe the consequences would be should it occur. By doing this you can consider what controls are available to eliminate or reduce risk ‘as far as practically possible’. And you can identify any costs associated with the control measures you choose to eliminate, reduce or control the risk.

Implementing controls

Not all controls are equal! That is, what’s good for the goose isn’t always what’s good for the gander. Whilst some businesses or organisations will often have the same risks/hazards the choice of suitable control measures may vary depending on the likelihood and severity of potential impact. The consequences of a fire on an offshore major hazard facility are likely to be more serious and require more costly control measures than say a fire in a single storey storage unit housing non-hazardous goods for distribution. There is a proportionality relationship between the risks and controls which are evident in many regulated sectors to exemplify the principle that not all controls are equal.

Reviewing & assessing your risk assessment

Having a written record of your risk assessment is critical; in most cases it’s also a legal requirement, not just an excellent business practice. We refer to this document as the ‘Risk Register’. Having a risk register not only provides a record of your assessment considerations and control measures but it provides the basis for auditing your business/organisation enabling you to be proactive in identifying new risks and new controls. It is a fundamental and significant business resilience tool for any organisation.

Before 2020 how many businesses/organisations would have had ‘working from home’ procedures identifying and evaluating risk and appropriate control measures? How much would mental health factors have been a consideration before the global Covid pandemic? And would the evaluation of mental health factors be the same now as it was in 2020?

Nuffield Group provides consultancy and support services including risk assessment and compliance. Find out more here.

This year Nuffield Group’s Health & Safety committee has been running a series on ‘Prevention is better than cure’. It’s been an informative and educational contribution to the business and it got me thinking not just about the idiom but the fact that, as we see time and time again in our business, prevention is actually also cheaper than cure.

Let’s view this in the context of the current Covid global pandemic and hopefully this is not a controversial view: Numerous outbreaks of Covid throughout the community in most every State of Australia have come from breakdowns in hotel quarantine. The consequent lockdowns have cost our economy billions of dollars. The cost of purpose-built quarantine facilities, like Howard Springs in the Northern Territory (where no outbreaks have spread into the local community to date), is in the 100s of millions. Ipso facto – it would have been cheaper to have purpose-built facilities than to have to deal with the consequences.

‘Prevention is better than cure’ is a concept dating as far back as the 13^th century with the Latin saying “It is better and more useful to meet a problem in time than to seek a remedy after the damage is done’. In the 1500s Dutch philosopher Desiderius Erasmus coined the somewhat more pithy ‘Prevention is better than cure.’

In many aspects of our business we work closely with customers to do just this. Whether we’re developing a safety case or a risk assessment; providing training or support for emergency and crisis management; reviewing or updating regulatory & governance compliance; or looking at processes and providing solutions tailored to specific industries and sectors; What we do is help with prevention so the cost is cheaper than having to deal with the cure.

What’s more, we’re not just talking dollar cost here. There is a human dimension and cost to not taking the prevention route. There’s also a positive people component when prevention includes training and upskilling. That’s why we focus on building resilient businesses, helping organisations focus on preventative controls to de-risk their operations and improve health, safety and environment for their workers.

I know it’s stating the obvious but, to my point above, we still don’t have purpose-built quarantine facilities do we? It all starts by assessing your risk, identifying what preventative and mitigation controls you want, and then ensuring any training, processes or structural / framework changes are adopted and adapted to ensure you maximise your preparedness to prevent rather than cure.

Nuffield Group has invested in developing its capability in Emergency and Crisis Management to support customers and organisations build safety and resilience into their business. Nuffield Group provides consultancy and support services as part of their Integrated Emergency Management & Recovery Team. Find out more here: https://www.nuffieldgroup.com/our-products/iemr

One of the questions I was asked every year of my career in the fire service was “Is the fire season going to be bad this year”?

My response was always the same. “Every year will be a bad year somewhere, just make sure if you’re at that somewhere, you’re prepared”. Now is the time to act!

There are a number of indicators that are very useful to gauge the likely extent of our annual fire season. Some of these indicators are technical and require a level of expertise to interpret such as the Southern Oscillation Index which measures the difference in surface air pressure between Tahiti and Darwin and the Keetch-Byram Drought Index (KBDI) which is a numerical value reflecting the dryness of the top layer of soils, deep forest litter, logs and living vegetation. Other indicators are more intuitive such as the amount of Winter and Spring rainfall, the number of warm and windy days leading into Summer and the level of fire activity experienced across Europe and the United States of America which have experienced a large number of mega-fires this year.

The Bureau of Meteorology, provides an annual Bushfire Seasonal Outlook for all parts of Australia. The current Bushfire Seasonal Outlook states: “The Spring 2021 Outlook presents above normal fire potential for conditions over south-east Queensland and northern New South Wales, driven by grass and crop growth in these areas. In Western Australia, the above normal fire potential in the north is driven by grass growth and dry soil in the area. Below normal fire potential is predicted across the ACT, New South Wales and Victoria as a result of vegetation recovering from the 2019–20 bushfire season.

While most of Australia shows normal bushfire potential during the spring outlook period, destructive and deadly fires can still occur during normal bushfire seasons across Australia. Fire potential can vary greatly, even at the smaller scale, between bordering states and territories. Each state and territory’s assessment considers different land-use types and vegetation types. This, in turn, is influenced by different forecasts for temperature and rainfall over these regions.”

Whilst the outlook is a very useful resource and indicates we are likely to experience a number of fast-running grass fires, it does not replace the need to prepare your property or business for a possible bushfire or grassfire event.

So, how do you prepare?

Preparation can be divided into two categories: Property and People.

On your business property 

• Manage long grass to less than 100mm in height.
• Maintain shrubs, garden and trees by removing all the dry or dead foliage.
• Keep access into and around the property clear.
• Ensure clear access to any water points.
• Practice good housekeeping when storing materials and products outside particularly on your property perimeter.
• If you have fixed fire protection features like hose reels or equipped hydrants, familiarise yourself with their operation. All fires start small and you might be able to knock down a fire whilst it is small.

For your people

• Stay informed by monitoring the Vic Emergency Website: emergency.vic.gov.au and the Vic Emergency App.
• Regularly brief employees about the current fire danger, particularly on days of high fire danger
• Maintain regular communications about fire risk with employees that work offsite
• Practise your response to a grass or bushfire as predetermined in your businesses Emergency Management Plan.
• Plan for the welfare of your employees and families. Do you need all employees on site on high fire danger days?
• Consider your evacuation plan and remember the safest option is to leave early.

Further actions for your consideration

• Liaise with your neighbours to understand their level of preparedness and work together where possible
• Discuss your level of preparedness and the needs of the fire brigade with your local fire brigade members
• Review your business continuity plan 

The Nuffield Group has invested in developing its capability in Emergency and Crisis Management to support customers and organisations build safety and resilience into their business. Nuffield Group provides consultancy and support services as part of their Integrated Emergency Management & Recovery Team. Find out more here: https://www.nuffieldgroup.com/our-products/iemr

It’s hard to fathom going to a bar for a drink and being served ‘flat’ beer – even in the UK! Worse still imagine being unable to go to hospital to have a medical procedure. And yet, this amazing situation is currently playing out in the UK and perfectly demonstrates why you need emergency management planning because comprehensive planning is the only way to deliver resilience in supply chains.

Carbon Dioxide (CO2) is an important additive in the food, beverage and health industries. It is used widely, for example, in the carbonisation of water, soft and alcoholic drinks; It is also used to stun pigs and chickens before they are humanely processed through abatoirs; It used in many medical procedures for humans too and it is used during packaging of a variety of supermarket foods to ensure extended shelf life.  

In the UK, the current shortage of carbon dioxide has come about because two large fertiliser factories have stopped production because of soaring wholesale gas prices. Fertiliser plants generate CO2 as a by-product of their production process. The result? A 60% reduction in the UK’s food grade carbon dioxide supply.

The reduction in CO2 supplies has caused such shortages in the availability of a range of products that it has required intervention at a national government level. It is a remarkable situation and one that is proving difficult to resolve because the situation has arisen due to a fall in demand for fertilisers, not a fall in demand for carbon dioxide itself. The crisis has drawn attention to the fractured responsibility that exists in the supply chain and its management. Politically the issue lies across many areas of government.

Interestingly, this is not the first time a crisis involving the supply of Carbon Dioxide has occurred. It tends to be a cyclical event caused by a decrease in the production of fertiliser over the summer period. In 2018 a similar situation was reported. So, this incidence is entirely predictable and should have been resolved by proper emergency management planning to ensure resilience in the supply chain.

It is a great learning opportunity for all of us. All businesses need to ensure they have identified weaknesses and potential emergency situations and planned accordingly to deliver business continuity. Planning is the key to building resilience into systems and businesses.

The global pandemic has introduced a new normal to this equation. There’s more volatility, uncertainty, complexity, and ambiguity in our everyday lives, so we need to plan better for the unexpected. This requires a change in mindset and thinking. It requires businesses to perform detailed risk planning to identify vulnerabilities and adopt controls to ensure supply and operations.

Through Covid a key learning has been on the very issue the UK CO2 crisis illustrates – security of supply chains to ensure a business can continue to operate. There are many current examples where a lack of foresight has been exercised and businesses have been exposed. The automotive sector is a great source of learning along with many of our iconic parcel and package delivery services that have had to adjust their services due to unprecedented demand.

The learnings from the UK case study and Australia’s Covid experiences across a range of sectors make it abundantly clear that all businesses need to adapt quickly based on good data, intelligence, and evidence, leading to prompt decision making and the establishment of a rapid deployment capability.

It is an ever-changing world with new challenges and opportunities for businesses. Nuffield Group has the expertise and experience to support businesses in their risk assessment and emergency management planning.

Find out more:

contact us via the form on this website; email us direct at nuffield@nuffieldgroup.com or call 1300 308 257 or +61 404 852 062