According to Nassim Nicholas Taleb, Black Swan events are rare, catastrophic events that many retrospectively assert could have been predicted and thus prevented. But can they? Could your company’s operational performance cause the next Black Swan tragedy?
Before we answer the question of whether or not your company’s operations could cause a Black Swan event, I need you to consider your organization’s risk tolerance as we’ll be defining the Black Swan event in those terms.
You see, Black Swan events reported by the media are defined by a much higher impact and scope than what most organization’s can tolerate. So with your organizations unique tolerance in mind, consider the following question sets regardless of how the event might be initiated:
- Does your company’s operations involve significant amounts of hazardous or potentially hazardous materials?
- Does your company’s operations involve high energy systems or materials?
- Does your company operate in an inhospitable environment such that inappropriate operations could result in harm to a large number of people or result in significant damage to assets or the environment?
- Does your company provide a commodity without which a vital service would be impaired?
- Does your company’s operations integrate with others such that a mishap could bring down a network supporting the provision of vital services?
- Could a relatively large number of people be impacted by an operational mishap at your company?
- Could a significant asset loss be incurred by an operational mishap at your company?
- Could a significant environmental impact result from an operational mishap at your company?
If you answered yes to any of the Set 1 and any of the Set 2 questions, your organization’s operations could cause what is for you a Black Swan event.
As a leader of a susceptible organization, your next questions become:
- How can we recognize the rising risk of a Black Swan event?
- How do we minimize our risk of causing a Black Swan event? and
- How can we prepare for a Black Swan event now in an efficient, financially responsible way that balances cost and risk mitigation?
To help you answer these questions, we’ve prepared a FREE video training series: Preparing for the Black Swan. During this online training course, you’ll learn:
- the warning flags of rising Black Swan risk
- how to develop a healthy safety culture to minimize the risk of a Black Swan event
- how to responsibly prepare for a Black Swan event through the implementation of protocols for responding to a Black Swan event should one occur, and
- how to effectively monitor for rising Black Swan event risk
About the Author
Nathan Ives is a StrategyDriven Principal, and Host of the StrategyDriven Podcast. For over twenty years, he has served as trusted advisor to executives and managers at dozens of Fortune 500 and smaller companies in the areas of management effectiveness, organizational development, and process improvement. To read Nathan’s complete biography, click here.