Importance of Monitoring and Controlling Risks

In this podcast Ricardo discusses the importance of monitoring and controlling the risks. He says that the risks are "alive" and that monitoring is the only guarantee that the response will be really effective.

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Episode transcript

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Hello everybody welcome to the five Minutes BM podcast today, like to discuss with you the risk monitoring and control. One thing that sometimes amazes me is that a lot of people think that risk management is only identify, Risks measure the risk or the probability and the impact, and then calculate the exposition and then maybe buy an insurance or do something to avoid are to minimize this risk or mitigate this risk.

But at the top that I wanted to cover in this Podcast is the last stop. This is how we can monitor the risk. How we can understand that risk is not something static that we put on the wall. And it's done. This is a very, very serious topic because I know many, many people that think that they are doing risk management, because in the beginning of the project, they identified the risks. They measured the risks and they decided on action items regarding each of that Risks and Dan, this is not correct.

Why does it is not correct? Because the risk is something alive. It's something that is changing every single day in the good side and else in the bad side, So Risks can meet the gate itself without doing anything. All the Risks can damage much more over the time. And I need to be aware to understand if the response that I'm given, it's a strong enough to control that risk.

Let me give you two examples. I remember when I was the boy, a young boy and my mother bought a for luck, a key this put on the front door of our home to avoid people to enter. So it's an extra art, something like a security laugher, and that at that time, this reduce it dramatically. Any probability of someone coming to my home.

So this is like a R more, the door is like, make it Bulletproof or impossible to come in. Now, if you check on YouTube, you will learn techniques from open an unlock and the activate this locker in something like 30 seconds, 45 seconds, one minute. So that, that happened in 30 years ago. It's completely different right now. So the response to avoid people to come into my home, it's different.

So I need to buy now maybe a much stronger locker. Maybe I can change. I need to change maybe the material that I'm built in the door. So I need to improve and put extra security because the environment is changing. The second example, it's like Madison, I need to monitor my patient to make sure that the Madison is solving the problem. And if it's not solving, I need maybe to use a more powerful Manson, a more powerful drug to different situations.

So this comes from Monitoring. I can't forget. Then just put on the water and say, Oh, I'm done. The rest of management is done. And I'm reading. This is not the right approach. This is not the right approach because of the word is changing. Maybe when I received more information, I need to reframe my ideas and recognize. And with that information, I can't check the, he is going up or is going now look, one example.

What happened in September 11 before that time, we never thought that something like that could happen. Look now how we are facing the risk in a different way regarding terrorist attacks. Why? Because we have Monitoring. We are checking now no liquids liquids anymore on the airplane because of new information, I leave of the TRM of Thomas base and from statistics.

And he said that. And when we receive more information, we reframe more perceptions of probability. Let me give you a quick example that they use to teach that let's suppose that I want to understand the probability of an elephant. He beat me on the street. May be when I tell, you know, is this right? Now? You say all the probability zero, but let me give you a not only information. There is a circus close to your home.

This change. Let me give you maybe in an hour, a second information, the circus it's a lot. And the elephant circles. Let me give you the turning information maybe tomorrow and save one elephant scape from the circus. Look, as soon as I receive more information, I reframe my ideas. I reframe all my Risks approach. So this is what I'd like to discuss with you are so important to understand that this is a alive.

This is something that is changing dramatically. If we don't do this, we are not the proper risk management. So keep this on mind. No, Monitoring no risk management, no risk management. I hope you enjoy this podcast. I wish all of you, American Christmas and next week will, will make a reveal of 2010 and in the Rick. And we will talk about the perspectives for 2011 as I do out on every single end of the year.

So Merry Christmas for you, for your family success and everything for you for next year. Bye bye.

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