Experience

By Rick Nason, PhD, CFA
Partner, RSD Solutions Inc.

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In reading through the paper this morning a real estate ad briefly caught my eye based on its brightly coloured tag line “Experience does not count – until it does!”

This is likely true in real estate as well as many other professions as well.  It is certainly true in risk management.  At many places you could probably have a novice be the risk manager.  It might be argued that if a novice was the risk manager then it was a sign that a very experienced and intelligent risk management team had put in place a risk system that was so advanced and well thought out that even a novice could manage it.  How comfortable does that type of experience make you feel?

Another argument to ponder is whether experience is helpful or harmful when a novel situation occurs (which is what almost all significant risk situations are).  Or another argument to raise is whether academic experience counts more or less than practitioner experience.    It also needs to be considered what the shelf life of experience is; does experience age like a fine wine, or like a half-smoked stogie.

“Experience does not count – until it does”, is a wonderfully ambiguous phrase.  It is perfect for risk management.