I hear there's a little oil leaking in the Gulf of Mexico. Wait a minute, the leak seems to be getting bigger. Oops, can't seem to plug it up but everything is being tried. Oh, and it's even bigger than first thought.
I can hear you asking, "what can an oil leak can possibly have to do with leadership and management in my organization?" The answer is nothing (regarding the leak, that is). What it does have a lot to do with in your organization is how that leak was managed both before it occurred and after.
In many of the training sessions Wipfli's nonprofit and government group provides to our clients, we spend a lot of time discussing risk management from the perspective of how those decisions would play out on the 6 o'clock news. In the case of BP, we continue to learn that some very smart people made decisions based on what they believed the risk of a bad outcome was. That is, they thought the chances of fouling the Gulf of Mexico were far smaller than the positive outcome they were hoping for. And the decisions they made would therefore never be on the 6 o'clock news. We all know the result was different.
When the bad outcomes did make the 6 o'clock news, I'd say we generally don't feel like we got the whole story. I have no idea whether incorrect information was provided purposefully. All I know is that it was incorrect and went a long way to eroding the trust we have both in the corporation and the government agencies that regulated the corporation's drilling operations.
Let's go back to your organization and think of the decisions you make on a daily basis. How would your community feel about those decisions? Would people trust your organization more, less or the same based on those decisions? We ask our funding sources and our communities to give us money to complete our mission. We need those funding sources to trust that we will be good stewards of those dollars and that we will follow the rules and regulations regarding how those dollars are used.
For example, an organization may be allowed to lease or purchase a vehicle for organization business. There are two vehicles to choose from. One is a very well-equipped Chevy Impala that can be purchased for $30,000. Another is a last year close out Cadillac CTS that can be had for $30,000 (a really good deal). Same price. Way different perception when you are seen driving down the street. Way different story on the 6 o'clock news, even though you can argue that each decision was just as fiscally prudent. Way different trust in your decision making for the next purchase decision.
Today's climate is not very forgiving of decisions that have bad consequences. Our job as leaders is to make sure we understand all the risks and consequences around those decisions. In addition, we need to be prepared to be open, honest and upfront in the event the outcome of our decision is now what we expect. This is stewardship of the trust our funding sources and communities place in us.
How do you manage the risk around decision making in your organization?