Snowstruck – a risk management primer

Almost every aspect of our lives has some degree of risk associated with it.  The Statistical Abstract of the United States, a publication of the U.S. Census Bureau, tells us that 59,964 skateboarders were injured in 1999.  That figure includes a lot of strawberries, broken bones and more serious injuries, causing me to conclude it’s unsafe and not worth the risk to skateboard.  Surprisingly, however, that same year saw almost as many people victimized by their toilets, sustaining injuries serious enough to require a visit to an Emergency Room.  Despite the risks, I’m going to continue to use the porcelain fixture.  Apparently, there just isn’t a safe place or activity.  We humans are capable of falling on or from just about anything and hurting ourselves, reminding us that gravity isn’t just a good idea, it’s the law.

Most of us don’t, and shouldn’t, spend our time worrying about every risk we could encounter in the course of living our daily lives.  We’ve simply grown accustomed to them, long ago weighing their risks and the rewards, concluding that the odds are in our favor.  Ironically, our comfort with risk creates a new form of risk, the illusion of safety that results when the negative consequences of risk have been successfully avoided for a period of time.  Becoming anesthetized to risk almost always has a disastrous outcome.

Avalanches provide a useful metaphor for risk and risk management.  Jill Fredston, avalanche expert and author of Snowstruck: In the Grip of Avalanches writes about the science of avalanches, avalanche prediction and risk management.  There is much we can learn about risk, its psychology and management, from studying avalanches.  Until I read this book, I assumed that avalanches were freaks of nature, wild and unpredictable.  They are indeed natural disasters that take an average of 28 lives per year in the United States.  But the conditions for and causes of avalanches are well understood.  So well understood, in fact, that anyone who might venture into avalanche country can choose to learn them and, more importantly, avoid them.  They are a manageable risk.

Fredston shares that the word risk has its origins in the Italian word rischiare, which means, “to dare”, a definition that implies both opportunity and choice.  We each process that opportunity and choice differently, and not always rationally.  “We sit in our living rooms, our doors barred against homicidal strangers, watching news of the latest killer virus across the globe while snacking on enough chips to invite heart disease onto the couch with us.”  Time then enters the picture, altering our ability to gauge risk.  As we experience a lag between taking a risk and experiencing the consequences, we are fooled into believing the risk isn’t there.

Avalanche science is advanced enough to predict when and where avalanches will occur based on wind, temperature, degree of slope and other factors.  It seems the greater challenge is convincing the skier that safely traversed a slope yesterday that today, that same slope is hazardous.  Laurence Gonzales writes in Deep Survival that our experience works against us: “the word ‘experienced’ often refers to someone who’s gotten away with doing the wrong thing more frequently than others.”  We think of experience, Fredston observes, as a classroom, but it can also be a prison.  “Often people learn more from making bad decisions than good ones because the consequences are less ambiguous.”

Some individuals and businesses develop a faulty, even fatal risk paradigm, caused by a high tolerance for risk that leads to the filtering of information about a given risk.  The result is judgments based on optimistic risk assessments.  Sociologist Charles Perrow, in his book Normal Accidents, writes: “making a judgment means we create a ‘mental model’ of an expected universe.  You are actually creating a world that is congruent with your interpretation, even though it may be the wrong world.”

There is irony here, because these warnings about risk should not lead a business or person to a total risk avoidance strategy.  It simply isn’t possible, but of greater importance, life without risk is no life at all.  The business that fails to push the envelope of risk accomplishes nothing meaningful, and in the end is quite forgettable.  The same is true at the individual level.  As Fredston observes, “if everyone on the planet had an equally modest appetite for risk, most of our civilization’s celebrated strides would never have been realized.”

It seems that a wise strategy for managing risk is to focus more on the objective we’re pursuing rather than the risk associated with it.  “Managing risk is a balancing act between a desired outcome and the probability of achieving it,” Fredston states.  “Knowing your goal is key because it becomes the yardstick that helps determine how much you are willing to put at risk.”  Learning from past failures to manage risk is also wise, because, to paraphrase historian Thomas Bailey, every time history repeats itself, the price goes up.

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About Jerry Rackley

An avid reader, mostly non-fiction, I read great books and think how the lessons of history have contemporary application. Most of these thoughts are work related, but sometimes about faith or family. This blog is my first attempt to allow some of these thoughts to escape the rather thick skull in which they were born.
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