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Crawling Under Your Desk is not Risk Management
What you can learn from the "duck and cover" days of the Cuban Missile Crisis.
Fifty years ago the Cuban Missile Crisis was playing out on an international stage less than 700 miles from my sophomore classroom. The morning the U. S. Navy confronted the Russians our teacher walked in and sat on his desk facing a roomful of anxious students. He said: "boys if you see me get up and crawl under my desk get under yours. It means I've seen a mushroom cloud." We laughed nervously. Most youngsters today are familiar with fire drills. In those days we were trained in atomic bomb drills. Instructions were clear: crawl under your desk and stay there until the 'all clear' is given.
Don't believe me? Look in the mirror. What risks do you manage? I'd bet the majority of your risk management expertise, time and energy are invested in managing risks that are comfortable to you (physical perils easily covered by insurance) and not by the real and evolving risks that threaten your clients (and yourself) everyday. I'm sure you and your team are great when a client gets sued, has a fire, their employee is injured or killed or someone goes south with the cash. These losses are not going to cause the death of your clients (since they have insurance). What is going to take them out are the risks that are uncomfortable to you and all too often not yet considered by them -- since they are depending on you to bring these risks to their attention! Many of you may not be any better prepared for these other disasters than your clients. Remember: "physician heal thyself." Let me offer this lightning (pun intended) round of risks that desperately need to be managed in your shop and in your clients' operations. I'm guessing most of you haven't had a serious conversation about most of these much less all of them. If you have told a client you manage risks, these are your job. Remember E&O is about errors and omissions! This is not all inclusive but it is a good start. Real disasters are like Hurricane Katrina, Joplin Missouri's tornadoes and the Japanese earthquake/tsunami/nuclear crisis. These don't just damage property, they destroy communities, families, commerce and create uninhabitable zones for months or years. These crises have more moving parts than most have ever considered. Ask someone who has survived them if they were prepared then? Are they prepared now? Are you? We are addicted to technology, the Internet, social media and every other gizmo and gimmick in the world of "E" and "i." What happens if a terrorist unplugs the world for a week? What happens if an anarchist hacks into your system or that of a client? They get into the systems of our military -- yours would be easy to enter. What if Apple bought Travelers Insurance Company and then went "direct" using "Siri" as the production/customer support team? What if what you sell becomes unaffordable to your client? I just heard someone say "that will never happen." Wrong. Most of you are looking dead in face of looming health care reform and praying that it is stopped, repealed or diminished. The threat is not that PPACA will stand -- the threat is that government will expand its presence and next take over property insurance in coastal zones, which probably houses 60 percent of this country's population (think National Flood Insurance Program) or worker's compensation (with guaranteed access to health care and numerous government bureaucracies to "protect" workers -- why not?). We've living through the Arab spring, Occupy Wall Street and the 99 percent to 1 percent confrontation. We're not "our father's Oldsmobile." What if the marketplace or government turns on you or your client? What if one of us is demonized? Who will prevail? Our brand is important, we protect it. It is our value! Tell that to GM, AIG, Bears Stearns, Lehman Brothers, etc. We're in the people business yet often fail to see the inherent risks. Talent is most valuable. A non-compete or key person policy gives you comfort but doesn't provide the security you think. Employees are volunteers. Create plans including them. Add to this worry list issues of "money" (not being able to access it when you need it, geo-political risks (think Greece, European Union, California, etc), environmental disasters (think, dirty bomb), vision/strategies that aren't aligned with the dynamic market as it is or as it becomes and a green movement that may someday declare something your client sells as toxic! Feeling anxious? Get up from under your desk! November 20, 2012 Copyright 2012© LRP Publications |
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