ROB QUAIL, BASc
Outsourcing Program Manager, Hydro One Networks Inc.
The guidelines and advice in this chapter are based on the author’s experience facilitating more than 200 risk workshops of various forms, with the number of participants ranging from 8 to 800. It is not intended to be a comprehensive guide to facilitation techniques, but assumes the reader has some basic understanding of how to facilitate a management meeting.
A risk workshop is a structured, large-group conversation about future uncertainties.
It is tempting to think of workshops as merely a data gathering exercise; after all, from the risk manager’s perspective, the workshop provides access to a whole roomful of experts for a specified period of time. It gets results much more quickly than data mining of similar scope, and certainly is much quicker than surveys or individual interviews.
However, the benefits of risk management workshops go far beyond the convenience for the risk manager:
The following sections provide a general model for planning and executing a typical risk workshop. The entire process is depicted in Exhibit 10.1.
A smoothly run and successful workshop that results in usable outcomes depends on adequate preparation; an effective workshop on risks is never the result of “winging it.” Regardless of the objectives and nature of the workshop, the greater the extent of preparation, the greater the likelihood there will be of a successful outcome.
Given the use of tools such as “anonymous” voting and facilitated discussion, a risk workshop has the appearance of being a democratic process. It is not. It is a consultation and should be conducted under the leadership of a specific decision maker. Therefore, all risk workshops must have an executive sponsor who is ultimately accountable for the scope of the risks under discussion; someone who is “in charge”; someone who ultimately “owns” the risks. This person is not the risk manager. The role of the sponsor for a risk workshop is to set the context for the workshop, provide a view of their tolerance for risk taking, to pass ultimate judgment, on behalf of the broader organization, on the tolerability of risk exposures, and ultimately be able to present the results to those to whom the sponsor is accountable.
As described throughout the following sections, the sponsor will make decisions concerning the planning and design of the workshop, he or she will play a critical role in setting the context and tone of the workshop itself, and he or she will ultimately assume responsibility for the outputs of the workshop and ensuring that agreed-to actions are completed. Although the risk manager will do all the “heavy lifting” in terms of planning and executing the workshop, the sponsor will need to make key decisions before, during, and after the workshop and together these decisions will be the ultimate determinant of the workshop’s success.
It is imperative, in designing a risk workshop, that the facilitator gets a clear understanding of the sponsor’s objectives for the workshop, as this will have implications for most other aspects of workshop design. A useful model for understanding these objectives is illustrated in Exhibit 10.2.
The vertical axis of this figure represents the desired discipline of the workshop. Learning Discipline workshops, at the bottom of this scale, place the emphasis on discussion and casual discourse on the subject risk areas, to enhance individual and collective understanding of the risks, rather than driving toward decision making. The process is loosely defined, there is a lot of scheduled “slack” in the agenda, and the facilitator is relatively hands-off in allowing the discussion to follow the apparent interest of the participants. Learning workshops are well suited to new problems and new risk areas, with relatively cohesive management teams and no real imperative for immediate decision making. Because workshops can be excellent team-building forums, they can also be well-suited to new teams, so long as the goals of the workshop do not include driving to immediate decision making on a specified list of risks and issues.
At the opposite extreme of the vertical axis, Decision-Making Discipline workshops are results-oriented. The agenda is highly prescriptive right down to the minute, the process is highly scripted, and the facilitator keeps the process strictly on-topic and on-schedule. Decision-Making workshops are, as the name implies, called for when a management team must make a decision immediately on the significance of risks and the adequacy of controls. A high degree of trust in the facilitator is required, because the facilitator will play a highly intrusive role in keeping the discussions on-topic and on-schedule.
The horizontal axis of Exhibit 10.2 depicts the focus of the workshop. Broad Focus risk workshops explore arrays or groups of risks at the strategic level. The emphasis is on identifying, understanding, and measuring risks, rather than evaluating the adequacy of mitigants, as the high-level depiction of risks may not lend itself to the discrete evaluation of mitigants to the point where a judgment of adequacy is possible. The agenda of these workshops will allow for greater understanding of the risk environment and the interplay of internal and external factors on the risks. Such workshops are useful for executive teams at the start of a strategic planning exercise. They are also useful at the commencement of large projects or programs (the “storming” stage).
At the opposite end of the horizontal scale in Exhibit 10.2, Narrow Focus risk workshops are targeted at risks that are depicted and understood to a high degree of specificity. Such workshops will normally make use of performance or other indicator data, and may require the participation of functional or technical experts. Narrow workshops also allow for a greater emphasis on the evaluation of controls and mitigants for each risk. These workshops are best suited for technical groups and detailed planning exercises, such as annual departmental business planning.
Note that it is not an either-or decision. The facilitator must get an understanding of where among these four extremes the sponsor’s preference lies. This can be gleaned by asking questions such as:
The scope of the risk workshop will consist of three elements: (1) the Organizational Objectives, (2) the Risk Universe, and (3) the Time Horizon.
In order to have an efficient workshop, easy-to-use reference materials are important. The following should be assembled prior to the session.
Exhibit 10.4 Sample Probability Scale
Rating | Likelihood Scale | Probability in Planning Period (5 years) |
5 | Very Likely | > 95% |
4 | Likely | 95% to 65% |
3 | Medium | 65% to 25% |
2 | Unlikely | 25% to 5% |
1 | Remote | < 5% |
Once the objectives for the workshop have been set, the next task is to set the agenda. An obvious question is how much time is available and how many risks can be covered in the available time? There are no hard-and-fast rules, but as general guidelines:
The method for choosing (from the Risk Universe) the risks for discussion is another decision that is primarily up to the sponsor. Alternatives include:
For most risk workshops, as a general rule, the target number of active participants should range from about 8 to 16. Smaller groups usually do not offer the variety of perspectives or require formalized facilitation of the type described in this chapter. Larger groups can be unwieldy and there are special challenges in controlling group dynamics and giving everyone a sense that they have had a fair amount of “air time.” Large groups can be accommodated but require additional detailed planning and more experienced facilitators; see the section “Tough Spots.”
The decision on who attends will ultimately be left to the sponsor. The list of attendees will depend very much on which risks are on the agenda for discussion, assuming these are known in advance: the attendee list should allow for full exploration of the risks on the agenda, and, if applicable, decision making on the actions to be taken. This means that the workshop should include functional or technical experts and key management stakeholders and decision makers. Another useful rule is to ensure that any person or group that might reasonably be expected to carry an action item out of the workshop is represented.
Other considerations:
To facilitate a risk workshop, the author recommends a two-person facilitation “team.” One person, the “facilitator,” will focus on running the meeting and guiding the discussion. The other person, the “record keeper,” will ensure that what is said or decided at the meeting is recorded. Although it is possible for the facilitator to assume both roles, experience has shown that the workshop can be run more efficiently and produce better documented results if there is a separate record keeper assisting the facilitator. Note: The record keeper role is not just a “recording” function. The record keeper must have the ability to listen to and understand the discussion and boil it all down to a few key points to be recorded and simultaneously displayed to participants (i.e., on to a screen by a projector).
Normally a U-shaped seating configuration is preferred as it allows for face-to-face contact, simultaneous reading of displayed materials, and a central position from which the facilitator can direct the discussion and keep everyone engaged. The ideal layout for the room will have two computers and two projectors and screens set up at the front of the room where all participants can see them: one screen for displaying context information and/or voting results (assuming anonymous voting is used) and the other screen for recording the key discussion points. It is also worthwhile to have one or more flipcharts for recording “parked items” and other items that may come up, but are not central to the agenda.
Often it can be helpful to hold the workshop away from the normal place of business, to avoid the temptation for people to sneak back to their desks. To further limit interruptions, the author has in the past deliberately chosen workshop venues where blackberry and cellular service is not available.
Assuming the preparation is complete and thorough, the execution of the workshop is focused mostly on maintaining or controlling the discussion, properly recording what is said and decided, and reporting the results.
The purpose of this section is to describe the basic elements common to most or all risk workshops, not to provide a detailed explanation of meeting facilitation techniques. More facilitation “tips and tricks” are provided in the next section. (Note: This section assumes the use of anonymous voting, which the author considers an essential tool for efficient risk workshop execution.)
Although the workshop will be customized based on its specific objectives and focus, each risk discussion will have the following components. For each risk:
The voting is followed by a conversation to explore the rationale behind responses and probe into the reasons behind diversity of opinion. To encourage a complete discussion, the facilitator should ask questions like, “Which objective did you feel was most threatened by this risk?” and “Please describe the mental journey you took in evaluating the risk and deciding how to vote.” The facilitator should record the key perspectives of participants.
The primary objective of this discussion is not necessarily to “force” consensus on the magnitude of the risk (although this is of course preferable), but to ensure that all perspectives get communicated and are understood by all participants, especially the sponsor.
This portion of the workshop can involve one or more revotes and rounds of discussion. The facilitator should introduce a revote by saying something like: “Now we have heard a range of perspective and arguments on the potential magnitude of this risk. Let’s see how many of you have changed your minds as a result.” It may take multiple iterations of “vote—discuss—vote—discuss” to complete this part of the agenda. It is important to remember that the role of the facilitator is to get all views on the table and encourage constructive debate.
It is important that the discussion on actions not become too detailed, or it will derail the discussion and put the agenda at risk. The author has found it useful to categorize actions into two types:
As mentioned in an earlier section, it is best to have a dedicated record keeper in the room, recording what gets said and displaying it for all to see. This can be most conveniently done by typing key points into a computer and simultaneously projecting them on a screen so all participants can refer to what was said and know that the key points are being properly recorded. The intent is not to record every word that gets said, but the highlights of the discussion in point form. Also any decisions, conclusions, or actions need to be clearly noted. It is recommended that the record keeper prepare a template in advance that follows the workshop agenda (see Exhibit 10.6). Throughout the workshop, the facilitator must keep an eye on the note-taking screen to ensure that the record keeper is able to keep up with the discussion and capture the key aspects of what is said.
One of the advantages of having a real-time record keeper is that a report of the workshop, showing the risk map and discussion points and actions, can be finalized and distributed to the sponsor and participants as required within a matter of hours. The report should include as a minimum:
It is best to schedule a debrief meeting with the sponsor to walk through the highlights of the report and make sure they are clear on the next steps for following up on assigned actions.
The facilitator of a risk workshop is responsible for guiding the workshop participants through the process and ensuring effective and efficient discussions on the subject risks. This section provides some useful general advice and tips for workshop facilitators.
The author has used so-called “anonymous” voting tools (wireless keypad transmitters and receivers) for more than 200 risk workshops over a nine year period, to great effect. These systems allow the facilitator to pose a question, displayed for the group to see, along with a range of numerical responses (corresponding to the scales described in the previous section) and obtain and feedback to participants a quick, real-time poll of the views of participants. These systems have the following advantages:
What follows are some useful ideas to help ensure successful, stimulating risk workshops.
Tough Spots
We have shown how to plan, organize, and facilitate a risk workshop. Risk workshops play a vital role in ERM by helping engage executive managers and staff in understanding the corporate objectives and the risks to achieving these within given tolerances. As such, not only do workshops help identify and address critical risks, they also provide excellent opportunities for participants to learn about organizational objectives, risks, and mitigants.
Rob Quail holds a BASc in Industrial Engineering at the University of Toronto. Rob has an extensive background in the risk and control field, including Environmental Management, Occupational Safety, and Internal Audit. Since 1999 he has designed and facilitated more than 200 management workshops on risk and control at Hydro One. Rob has successfully applied Enterprise Risk Management to a disparate range of business problems and decisions, including annual business and investment planning, major transformational, infrastructure, and technology projects, acquisitions, partnerships, divestitures, downsizing, and outsourcing. Hydro One was so successful in integrating risk management into the core management processes and attitudes in the company, that late in 2003 Rob recommended that the group be dissolved as a full-time work group. Since then Rob has worked in the areas of customer care, project management, and outsourcer management, and provided risk management services to Hydro One’s senior executive on an as-needed basis. He continues to be a popular speaker at risk management conferences, and performs as a musician in clubs in the Toronto area in his spare time.
3.128.198.59