18 Dec Why risk assessment misses the point
Taleb is a former Wall Street trader and his book analyses the behaviour of financial traders in recent times, a subject which is endlessly fascinating considering the turmoil their risk culture threw the world into.
Being a philosopher Taleb tends to meander so my synopsis is incomplete, but one of the theories he introduces very early on is risk-as-a-feeling.
The theory goes like this
We (that is, every single one of us) assess risk using emotion and not logic. We use our emotion first and then logic second to argue against, or reaffirm the conclusion we’ve already come to from an emotional perspective. The most emotionally intelligent of us recognise that process and use it effectively. The least blindly shoot from the hip as we react to one situation and the next without really processing what’s important.
Taleb’s theory explains a lot about the behaviour of market traders during the crash – letting the positive emotions of monetary gain outweigh the potential risks of financial meltdown. This they ignored despite considerable analytical evidence of it occurring at the time.
It’s also why when there’s a mass tragedy in the news it colours everybody’s view of how risky a situation is because of the emotion attached to it. Is the gun situation in the US any worse because of last weekend’s tragedy in Newtown? Of course not, but you can bet that the debate will rage now because people are faced with the emotional horror of the situation in a way they weren’t before.
Emotional risk assessment on the shopfloor
To what extent do you consider people’s emotions when you assess the risks they face? Does that happen during risk assessment form completion after they get filed away never to be seen again or even on an ongoing basis as the job or equipment changes?
And how do you help individuals recognise and control their own emotions in these situations? For instance, do they know how a difficult personal situation at home is blinding their attitude towards risk? Do you know how to assess and manage that practically?
Or, are we safely ensconced in a mindset that says we’ve controlled the environmental factors and given people the right training. Are we complacent in assuming they’ll calmly assess and deal with risks as they appear?
My belief is that too many businesses are unable to understand the melee of conflicting influences that trigger emotions in people. Emotions that cause them to misjudge the risk of familiar tasks.
But we have tools to change that
It’s why effective safety discussions (or SUSA) are so powerful. Because, when done properly, it’s a conversation that taps into an individual’s emotional reaction to potential risk – “What’s the worst thing that could happen… what’s the impact to you or your family?”
So, next time you assess risk consider what’s really affecting people’s perceptions in the workplace: their emotions. It’s much more effective than filing away yet more fruitless risk assessments.