The Power of Dissent in Risk Management

Enterprise risk management is a hot topic.  The charge of Enterprise Risk Management is to identify and quantify an organization’s current and potential risks and opportunities, determine the company’s risk tolerance, and decide on risk-taking and risk-avoidance strategies.  Insurance professionals are especially attuned to the lessons of risk management.

There is one risk that persists in all enterprises: human error.  No matter how expert or how careful an individual is, there will come a point at which he makes a significant mistake. 

We frequently have people close to us who may notice our errors before serious damage is done – these people may be supervisors, peers, or people who report to us.  Unfortunately, when the person noticing the error is in a junior position, the dissenter’s voice may go unheard.

The book “Sway – The Irresistible Pull of Irrational Behavior,” by Ori and Rom Brafman, discusses the positive power of dissent, especially the dissent of subordinates, whether in a board room, a cockpit, or a surgical suite.

On March 27, 1977, two Boeing 747 passenger aircraft, KLM 4805 and Pam Am Flight 1736, collided on the runway of Los Rodeos Airport in the Canary Islands, killing 583 people.  According to “Sway”, subsequent investigation and review of the black box records show that a mistake by Captain Jacob van Zanten, the pilot of KLM 4805, resulted in the crash.  The runway was foggy and Captain van Zanten had only been granted one of the two types of clearance necessary for takeoff.  The first officer of the flight, Klaas Meurs, tried to point out that Van Zanten did not have the necessary second clearance, but was disregarded.  At the time, Van Zanten was the head of safety for KLM and had an impeccable record.

Several years subsequent to the Canary Islands disaster, NASA initiated a study on “Cockpit Resource Management” (or “Crew Resource Management”).  One finding of the study is that it is essential for subordinates to have effective tools to communicate possible mistakes to their supervisors, and it is essential for supervisors to tune in and listen.  Since then, several commercial airlines have implemented communication protocols to be used by the copilot or staff when they see a mistake in progress.  The crew is trained in how to make their statements most effective, and the pilots are trained to stop and listen.  Similar initiatives are being implemented in hospitals and other health care facilities, such that the concerns of a nurse or resident will be considered by the attending physicians and surgeons.

What do you think?  How would you grade your organization on “tuning in” to sources of concern?  Are they considered on the merit of the argument or on the basis of who is speaking?  If you work in the insurance or risk management field, how can your organization create an environment in which legitimate concerns are heard, no matter what the source?  The answers to these questions can make a difference in any industry, and certainly in the risk management industry.