A Beyond Risk Management Breakfast

A Resilience First breakfast briefing on 1 May addressed the topic of ‘Beyond Risk Management: how to deal with complexity and uncertainty’. Professor Lex Hoogduin, who is currently Non-Executive Director of LCH Group and CEO of Glocomnet, spoke to an audience of 25 members on his thoughts of human diversity and interaction.


He spoke about the business environment becoming increasingly uncertain and complex due to growing interconnectedness, accelerating technological change, the unfolding digital revolution, increasing regulatory complexity and the changing geopolitical landscape. Events that previously went unnoticed may now have significant impact on a business. The number of positive and negative surprises that will affect a business will continue to grow. He introduced a model for dealing with this.


The basis of the FAUC (Framework for Acting under Complexity and Uncertainty) model was around seven capacities of an organisation: Awareness, Resilience, Adaptability, Anti-fragility (i.e. the capacity to benefit from getting better under stress), Creativity, Knowledge and Entrepreneurship.


Out of this framework has come a range of applications to assess and develop both an individual’s and an organisation’s capacities to deal with complex and uncertain issues. The key was to protect the downside and maximise the upside of risk. Often, failure was as a result of a lack of imagination about the possibilities and surprises. There was also a need for a ‘just culture’ which involved combining learning with accountability.


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