Risk Management and the art of Motorcycle Riding

Risk-based management is an under-developed capability within many managers armoury, but if leaders ignore it businesses are exposing themselves to failure in both minor and major ways. Indeed, a lack of risk-based management is one of the reasons why the world is now in deep recession.

When I talk to people about risk-based management, I use motorcycle riding as a good way to describe what needs to happen. I ride motorbikes, I have done for the past 10 years or so. Bikers survive by having risk management at the heart of everything they do both prior to riding and during the ride and this is the lesson that leaders need to learn.

Today’s car drivers are highly protected and insulated from the world they drive through. This can be seen by the activities other than driving that drivers undertake: eating, drinking, talking on the mobile, reading, doing make-up, etc. I remember riding past a car once going 60mph and seeing the driver reading a magazine as they drove, I was gob-smacked. If drivers felt at all at risk, these activities would be shunned in order to ensure full concentration in the task at hand. This is how bikers feel, the world is highly visceral and the risks are there to be seen, heard or felt. It’s in your face, and at every moment there’s a chance that something horrible might occur, but a biker’s risk management strategy is the coping mechanism that enables them to enjoy the experience.

Most people in business are like the car driver, insulated from risk. The company will be here tomorrow like it is today; they’ll still have a job tomorrow as they do today. They feel insulated and isolated from risk and that is why panic ensues when an incident does occur – unlike the biker they have no coping mechanism. Thus risk management is deprioritised and in extreme cases we end up with the type of scenario the world finds itself in today. So, business leaders need to get out of their car and on their bike, heightening their awareness of risk and managing it sensibly on an on-going basis.

There are two types of risk that bikers are aware of, and again this is the same for business. There are risks that are ever present and then there are transitory ones. Systems to mitigate ever present risks need to be implemented whilst strategies need to be developed to manage the transitory ones so there is readiness should they appear.

From the biker’s perspective having a well maintained bike mitigates the risk of mechanical failure whilst a biker will deal with the transitory risk of a blind bend by using a pre-practised strategy, for instance looking for the vanishing point, slowing down and going wider. Businesses should have a similar coping mechanisms. For those ever present risks systems should be implemented that mitigate the risk. For transitory risks implement specific, well-understood and practiced activities that either deal with the actual risk or can be used to determine the risk, it’s impact and develop the coping mechanism there and then. Once these strategies are in place, the next step is practice. Practice, practice, practice. For both bikers and businesses practice helps perfect the coping mechanism and makes risk management automatic, just what both bikers and businesses need.

Unfortunately however many mitigating strategies are at hand, there will always be a circumstance where nothing helps and the risk becomes an issue. For the biker, this is the part where they have usually parted company with the bike and know something painful is about to happen. At this stage, it’s a bikers preparation that will have ensured the impending pain is minimised – a helmet to reduce head injury, decent armoured clothing to help protect arms, legs and chest, crash bars and mushrooms help protect expensive fairings. Businesses should be looking to protect themselves in a similar manner, by implementing standard process, policy and putting in place other business tools such as regular auditing, critical reviews of proposals, clear lines of responsibility, financial transparency and responsibility, etc, etc.

So, if you want a business that will exist in a few years time, get out of the car and ride the motorbike. Risk management needs to be central to the business and thinking like a biker is the only way to ensure that it becomes a core value. Oh, and riding a bike is far more fun, fast paced and thrilling than driving a car, and I think the same experience will be found when running a business in the same way.