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.

Planning Documents

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

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I worked for an organization that in one area was still very much in a growth mode.  In essence the organization was taking on a new project and the project manager was a lively and energetic person who had a knack for getting things done.  

The launch of the new product was a smashing success and the project manager cemented their reputation for getting things done.  As the new project rolled along, more people were added to the team and slowly things started to become institutionalized.  As more administrators were added, the demand for process and planning documents increased.  However there was a problem; the project manager who brought the project to life and who was still the key player in making things successful was not all that skilled in process and planning documentation creation.  This created a problem as the demand for more and more structure took hold.  It was not long before the project manager was pushed out.

You can probably stop reading as I suspect you know how things ended.  With the original project manager out, the number of processes and planning documents increased, while the quality of the project declined to such a state as to declare it unsustainable.

Professional managers often confuse process and planning documents for getting things done.  Only getting things done is getting things done.  Furthermore, the more experience working with people I have, the more I understand that the skills in getting things done are not the same skills that lead to creating process and planning documents.   This holds for projects and it holds for risk management.

Oliver Sacks

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

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The legendary neurologist Oliver Sacks, whose books and experiences as a doctor become famous as the material on which the movie Awakenings was based, passed away at the end of August.  Dr. Sacks was renowned for his ability to deal with people who had severe neurological conditions.  However as his obituary in the Economist (September 5, 2015) points out;

“ … his compulsion sprang from the fact that he was no good at medical research; that data-driven “testability” in the lab repelled him, whereas talking to patients, shy as he was, opened a door into private landscapes that were magical, challenging and almost unfathomable.  “Empiricism”, he wrote, “takes no account of the soul.”

“Empiricism takes no account of the soul” is something that risk managers need to take into their soul.  Virtually all of risk and risk management is based on the emotions and actions of people.  People have souls which drive their emotions and actions.  Empiricism is only the basis of action for the most shallow amongst us.  Talking, as opposed to data collection has something to recommend to not only neurology, but also risk management.