The Risks of Complacency -- Does Silver Rust?

The Risks of Complacency
Does Silver Rust?

It's funny that I write for the Silver Spring Chapter of PMI's web site, given that I was born and raised in the Rust belt. Many of you have never even heard of Youngstown, Ohio (the nearest 'big city' close to my hometown), and given current trends, you probably never would have otherwise. Youngstown is the antithesis of Silver Spring. In Silver Spring, the economy is booming, and if you can afford a home, it means that you have been saving a lot of money through the years to make it happen. Home values are on the rise, jobs are plentiful, and the big question is not whether you have a job, but whether or not it's the right one.

Contrast that with Youngstown. When I was growing up, Youngstown was a bustling steel town with a population well over 160,000. Today, the population has dwindled to less than 80,000. In the past three years alone, 5,000 people have joined the exodus. As the U.S. steel business has changed, Youngstown has begun struggling with what they euphemistically call "smart-sizing" issues. They are trying to hang on to the shrinking tax base and population.

In Silver Spring, the median home price is over half-a-million dollars. "Bargain" is anything under $300K. In Youngstown, you can still easily find bargains under $50,000 and the median home price is $115,000. The reason for this snippet of U.S demography? No one in Youngstown in 1965 or 1970 would have seen this coming. As fire belched from the mills, the town was riding a boom that seemed insatiable.

Could the same fate befall Silver Spring?

I don't think so, Carl. We have the government, not steel, as our primary industry.

Fair enough. But the reality is that no-one thought Youngstown's outcome would be as it has. No one could envision a city with half the population and a median income of $26,500. (Silver Springs' median income is over $61,000).

And what does this have to do with risk?

To get to where they are now, the folks back in Youngstown lived with a host of assumptions. They assumed that the environment was static; they assumed unions would continue to rule, they assumed no one would want to use different processes to make steel, and they assumed the government would ensure that the city continued to thrive.

Alarmingly, complacency is born of assumptions and culture, and a major concern that we should have is rooted in the notion that assumptions don't tend to change, leading us to a false sense of security. Classic examples? NASA and Challenger. Driving "with traffic" and your last speeding ticket. High blood pressure and heart attacks. We believe because we have survived risk one day that we will inherently survive it the next. But we fail to re-evaluate the conditions.

Great, Carl. Now you're telling me I should live in a constant state of paranoia?

Not at all. What we should do is live in a constant state of re-evaluation. (Please brace for an existential moment). If you read some Eastern philosophy (I Ching, the Tao), you find that they emphasize the ability to live within a given moment. They stress the importance of not borrowing from the past or driving too heavily into the future. The emphasis is on capturing the present. Meditation, and virtually all types of self-evaluation drive home the importance of recognizing the moment.

This ties into risk management in some rather surprising ways. Instead of evaluating risks exclusively on history, it points us to the need to look at a given moment in time and ask whether or not that moment has characteristics that make it risk-distinctive. The question is not "Are there distinctive characteristics that make this moment unique?" The answer to that is always "yes." The question is "Are there distinctive characteristics that generate a higher threat or opportunity level than we otherwise anticipated?" THAT is the hallmark of a non-complacent risk environment.

Leveraging that Insight

We can actually leverage that insight if we're willing to start our project meetings with that existential question: "What makes the project special today?" and then follow it with how that might impact our risk or opportunity posture. Just that simple question reminds team members that we live in a fluid environment, and that the moment today is going to be different...in some cases radically so...from the other moments in our project environment. It opens the door for a heightened awareness not only of risk, but of all of our project considerations--time, cost and requirements--as well as individual team member, management and customer satisfaction. With that constantly refreshed perspective, we don't take the "now" for granted. We accept it with all of the changes and insights and differences that it may bring to bear on our capacity and likelihood for success.

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Email This! -- Posted by Carl Pritchard on Monday, November 05, 2007
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