Cultural Risk Management Part III by Glen Burridge

Just how serious is it?

I’ve previously said there is a risk in our world that, by virtue of its very pervasiveness, we are more blind-sided to than any other. It threatens us with the most terrifying consequences if we do not respect it and, yet, if we harness its power, it can be an accelerator towards our greatest riches: It is that of Cultural Risk.

Assumption No. 2:

“Even if it exists, there is nothing to be done about it….”

This the biggest stumbling block we face and many people never get beyond this point.

This failure to see a solution is best explained by what can be ascribed to a malaise in both the Cultural and Risk fields.

Perhaps the question would be better re-framed:

“Why is the knowledge that exists to tackle it not being deployed more effectively?”

There are after all not one, but two fields of expertise meant to be dealing with this.

Let’s start with a simple representation of broadly pretty much any activity human beings engage in:

At the heart of this view lie two inescapable elements:

  1. What drives how groups of people behave: “Culture” (the shape of their collective motivations)
  2. What people do for the results they want: How they judge the benefits against the “Risk” (ending up in a desirable place in the range of possible futures)

    Glen Burridge Cultural Risk Model

    Cultural Risk Model

Why the intercultural signal has been lost

The field of intercultural studies should be a coherent whole, but isn’t. This is a deep irony as much as it is a tragedy.

Originally born of the need for anthropologists to make sense of “exotic” cultures that were cut from cloth very different from their own, the study of the ethnic or national dimension of inter-cultural relations carries with it a genuine, and life-affirming curiosity to explain, reconcile and improve relations between communities, whether they be tribes, regions, nations or even global blocs. Its remit can be said to range from the village green to the UN.

Equally, there have been various attempts at understanding the way assemblages of people work together as organisations since the 19th Century. Driven by a far more prosaic imperative of effectiveness, it reaches to understand the same dynamic of how people can work better together, whether it is in the name of financial profitability, optimising supply chains, guarding reputations or simply completing a mission.

Despite tackling many of the same material questions about human collective behaviour, these two perspectives remain unreconciled; the latter may not even be aware – let alone, seek co-operation with the first – with protagonists finding themselves having to delve into psychology, business studies, sociology, applied linguistics and communications for answers.

The only potential touch-point you’re likely to find is within international management studies, where the interface of culture is all but inevitable, but this is a niche. Pick up a publication from the two sides of the cultural coin and expect little overlap in thinkers.

In recent times, a third dimension has taken on a consequence all of its own, due to the ability for the global community to talk to and between itself. These are the self-identifying and potentially ephemeral cultures (manifesting, as they do, often in digital form) of networks. If there is one global social activity that perhaps defines our current time, it could arguably be this one phenomenon.

This fracture is at the heart of why we do not see our most pressing questions of the day framed in intercultural terms. There is no shortage of expertise or technique. It’s that the brand is simply too weak.

If you want a perspective on what the intercultural can offer and Glen’s own take on what holds it back, see his 2014 presentation slide deck from the Dialogin international management conference in Konstance here:

http://glenburridge.com/what-constrains-the-impact-of-cross-cultural-thinking-on-global-leadership-a-consultants-view-2/

Management’s nasty secret: It too easily forgets all risk is human…

The fundamental issue that has still yet to fully dawn on many organisations is that their greatest risk has always been and always will be human. No technology or opaque algorithm is going to change that anytime soon.

“All aircraft accidents are human factors accidents”

Captain Dan Marino, International Civil Aviation Organisation – pioneer of human factors in aviation safety

We are reluctant to contemplate the role of our own Human Factor in the vulnerabilities of a given situation. The complexity of our world and the challenges we create for ourselves mean this reticence to consider the risk we create from our own collective psychology is no longer tenable. The wonders of neuroscience, probability theory and data visualisation have also marched too far for any more excuses.

Now, some subjects are so huge and the issues so pressing, they require a whole new literature and approach. For the most eloquent raising of the warning flag on the way the spectre of uncertainty is handled by organisations, look no further than Douglas Hubbard’s brilliant The Failure of Risk Management. Otherwise, follow Alexei Sidorenko on LinkedIn, who posts almost daily on this theme.

In short, what’s gone wrong with the classic manifestation of “risk management” as we understand it today is that it is shot through with our own fallibility – to the point of its own self-destruction. We need to couple our stunning abilities to numerically model a sweep of possible outcomes and their probabilities with the Human Factor. Only then can we hope to provide the best chance for quality decisions and a far more realistic and resilient vision on the true uncertainty we are facing – from which threats will surge or benefits develop.

As we’ve moved into the 21st Century, a whole new field has become dedicated to this very task, born out of the lessons of behavioural economics and social psychology, namely Decision Science, a topic I will no doubt return to, since it is our greatest hope for a vehicle to resolve this.

Cultural risk management as a trade

The other good news is that the two most fundamental applications of cultural risk management happen to have been foundations of our global society for thousands of years. So much so, we can be forgiven to taking them for granted: They are the relationships we form with each other through diplomacy and through trade.

The art of finding a mutually agreeable solution between multiple sources of power must rank among the oldest three professions (even if others commonly are accorded the epithet!) and the fate of everything from individuals to, at times, the entire human civilisation has hung on its success.

Without functioning diplomatic relations, you do not have much of a basis for society-level stability, the ability to assure safety nor to progress through exchanging ideas and material objects with other groups. There’s a very close and immediately acting correlation between lack of diplomatic effectiveness and anarchy.

The first place to look for mastery of this art is, therefore, among the great diplomatic successes of history, sometimes which are acts by single individuals. And, then, to look, by extension, at those who seem to have an uncanny ability to reach out to many groups, either with ideas or products.

Stripped back to its elemental, cultural evolution comes down to the (sense of…) distance between parties and whether they have anything which the other feels is of value, whether that be material, knowledge or even an idea. This was true in the hundreds of thousands of years when we were not much more than a clever pack of apes eking out an existence, as it is now when a quantum scientist, salesperson or political commentator speaks to a collaborator, customer or journalist on the other side of the planet. We might wrap it all in cultural artefacts like research funding, capital and network analysis, but the essential dynamic is just the same as it was on that river crossing, tundra or forest clearing back in our earliest days.

About the Author – Glen Burridge is a management consultant who’s come to the conclusion that intercultural risk is the greatest threat and opportunity lurking in all we do. To handle it, we need to think of culture as multi-faceted, ever-present and a context for every decision we ever make.

Contact Glen at glen@glenburridge.com 

#culturalrisk #riskmanagement #humanfactors #intercultural #crosscultural #management #risk

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