In this blog by one of our senior consultants, Alan Penton MA, MIFE he considers risk in the context of organisational culture:
There is little doubt that we are living in unprecedented times with a global pandemic impacting on everybody’s lives. However, and not wishing to play down the human tragedies that this 21st century plague has brought, this is not the first time that we have experienced ‘unprecedented crisis’ in recent years.
The financial crisis of 2008, the collapse of financial institutions together with the subsequent ‘age of austerity’, all were described as unprecedented. The ‘whole-systems failure’ of fire safety that resulted in the tragic consequences of the Grenfell fire on the 14th June 2017, continue to be felt by the communities and housing providers, again reported as ‘unprecedented’. The scale of each of these events are ‘unprecedented’ in their own way, however, it pains me to say that each of these events were foreseen by leaders, colleagues and experts. Following previous failures in these sectors the potential for the re-occurrence of similar events were debated, recorded and planned for. In the case of fire safety following previous serious and loss of life incidents the subsequent investigations and enquiries resulted in the all too common recommendation that “lessons would be learned”
These events, a financial crisis, a catastrophic built environment fire safety failure and a global pandemic have impacted acutely within the housing sector. The financial impacts of reviewing and revising fire safety compliance for the sector is an ongoing challenge. There are already additional challenges that this increased spend has on the potential for housing providers to have their viability scrutinised or potential downgraded by their regulator. Further demands in response to the forthcoming Building Safety Bill and Fire Safety Bill has the potential to increase these challenges, housing providers are going to need to safely navigate the fire safety compliance minefield whilst ensuring the quality and integrity of these services are fit for purpose.
For some, the banking crisis and the Grenfell tragedy have led to increased risk aversion in some organisations, where, greater understanding of the issues have led to caution, or worse, decision inertia, where a lack of confidence and understanding lead to a default position of no action. In contrast, anecdotal evidence is being reported across a range of sectors, highlighting a more risk-taking approach to business, where they have ‘pivoted’ during the pandemic in order to adapt and diversify their delivery model. One example was recently articulated by Dame Jackie Daniel. As the CEO of Newcastle Hospitals, NHS Trust, she has commented that since Covid-19 impacted on the NHS ‘it has been a revelation’ and she ‘doesn’t want to go back to how it was’. She believes that the pace and acceleration of transformational change has created ‘a freedom and authority to act in a different way’, applying risk-based decision-making grounded in knowledge, skills, and experience (heuristic learning) in addition to evidence-based decision-making.
Housing providers deal regularly with crisis, thankfully not all of an unprecedented nature. A crisis can be a catalyst for transformational change, providing the opportunity for organisations with strong leadership to create the conditions and culture that encourages responsibility, accountability and an environment that supports rational heuristic and evidence-based decision making. The Grenfell disaster created a culture of uncertainty in fire safety compliance in the housing sector. This uncertainty is based on the perception of risk and the culture of personal and organisational decision making. Research states risk can never be perfectly rational. The perception of risk is ultimately subjective, it influences the choices we make as individuals and as a society. An organisational culture of no blame, transparency and learning should ensure staff rationalise their decision-making to one that reflects that of the organisation.
The forthcoming Building Safety Bill and Fire Safety Bill provides the opportunity for those housing providers who are risk averse and have decision inertia to ‘pivot’ towards an empowered decision-making culture that will embrace the legislative changes looking at improving the quality, value and safety of their customers and their properties.
We look to the future to see which organisations will successfully navigate these challenging times and become champions of these changes.
About Alan Penton MA, MIFE
Alan is an expert risk-management consultant with in-depth technical knowledge and effective decision-making skills, built during his career as a professional firefighter in the UK Fire and Rescue Service (FRS) along with his consultancy experiences.
During his career, Alan has attended the whole array of emergency response incidents imaginable, developing a reputation as an effective incident commander who focused on post-incident learning.
As the FRS sector expert, he was seconded to the Health and Safety Executive (HSE) to develop the audit process for the first-ever HSE full inspection of UK FRS health and safety compliance. He developed and introduced a comprehensive audit programme along with extensive in-depth guides, support packages and training programmes for HSE Inspectors undertaking the inspections. Following the inspection programme, Alan acted as the sector expert point of contact for the analysis and production of the comprehensive report which was produced.
Alan now concentrates on organisational risk management with a particular interest in social housing.
If you would like to discuss how ARK can support your organisation to adapt to the challenges these new legislations bring, please contact us – firstname.lastname@example.org.
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