The 3 little risk managers
Once upon a time there were three little risk managers (Jack, Jo & Rox) who all lived in a forest.
All three of them knew a bit about risk (or so they thought…) and realised that it was important to undertake a risk analysis of the possible things that could happen to them in the forest.
Jack considered that being dry and out of the elements was most important (he’d once caught pneumonia from a cold), and with rain being forecast next week, he quickly built his house out of straw and thatch. Once the rain had passed, he intended to finish his risk analysis.
The rains came, and Jack sat snugly in his hut watching Netflix and forgot about the rest of the risk matrix.
One week later, in bright sunshine, a wolf emerged from the deep forest and blew Jack’s house down. He barely escaped and ran down the road cursing his bad luck.
As he travelled through the forest he saw Jo putting the final touches to her house of sticks. Jo looked up at a rather dishevelled Jack and asked “What happened to you?”
“A wolf, that’s what!” he answered. “How unlucky!”.
Jo smiled smugly. Her risk analysis suggested that relevant risks in the forest included not just the weather but predators such as wolves and foxes. Jo had lost a relative to a fox and she wasn’t going to make the same mistake.
Just as Jo put the final touches to her house, clouds started forming and a thunderstorm loomed on the horizon. “Quick, get inside she told Jack – we’ll be fine in there and you can try my new coffee machine”.
While enjoying their decaf soy lattes, Jack thought about the impending storm. Severe storms seemed to happen more and more often these days. He wondered whether his next risk analysis (and subsequent house) should also take the changing weather patterns into account..
Later that night, the storm arrived and lightning crashed all around them. Suddenly the little house of sticks was struck by a bolt of lightning and caught fire. Jo quickly grabbed the coffee machine and Jack and fled outside into the rain before the house collapsed in flames. They spent the rest of the night shivering in the rain and cursing their bad luck.
Next morning, Jack (now sniffling) and Jo went in search of Rox to see what she was building. They found her, halfway up a hillside with views of the forest, laying down stone foundations for her house.
“Why are you building a stone house?”, Jack and Jo asked incredulously. “They are so expensive and take so much longer!”
“Actually, I haven’t fully decided what sort of house it will be” Rox replied. “I realise I need to be off the forest floor and have strong foundations, some weather proofing and protection from predators, but I wanted some more information before I finalised my plans. I have already spoken with others in the forest and was also going to consult both of you about your ideas”.
So all three of them sat down and discussed what they had learned from recent events in the forest. Jack and Jo in particular realised that losing their homes was probably not just ‘bad luck’ and more likely influenced by their prior experiences. Further, that had they taken more time to analyse their environment, they probably would have made different choices about their house structures.
After a long day of discussing and evaluating a number of possible forest scenarios, Rox decided on a house structure that provided the best mix of safety, cost and timing. Jack and Jo helped Rox build her house so it was completed more quickly, then built similar houses for themselves nearby.
And every year, Jack, Jo and Rox held a risk analysis picnic, inviting people from all over the forest. Everyone discussed and reviewed what they had learned about the forest over the past year and identified future challenges and risks and strategies that they could realistically apply to mitigate them. Sometimes they needed to renovate and extend their homes to address the new challenges, sometimes they didn’t have to do much at all, but all of the time they felt much safer about living in the forest..
The End.