That we work to live – not “live to work” – makes the Case for Safety, explaining why safety must come before every other business objective. The worst thing that can happen to a business is to go out of business, but that leaves employees perfectly capable of finding other work. Someone who suffers a life altering injury may no longer be capable of working.
As a leader goes about doing their job, the Case for Safety serves as one of the most valuable guiding principles, governing mundane everyday actions and decisions such as, “Who do I assign this job to?” and “What should I do while I’m out on the shop floor this afternoon?”
In the everyday practice of leadership, those things might seem insignificant – until there’s a crisis. Then, in an instant, formerly small things play huge; things heretofore taken for granted are called into question. Leaders start asking questions like, “Why do we do this job that way?” and make decisions, like “I need to look at this right now.”
Collectively we’re experiencing the process, at of all places, the bank. In a scene right out of the movie, It’s A Wonderful Life, there have been runs on banks, causing several to go out of business and raising legitimate concerns about the viability of any number of banks the world over.
Surely you have taken note. You might be struck by their dissimilarity – “How could a bank crisis have anything to do with sending my folks home alive and well at the end of the day?” If risk, complacency, accountability and safety sound familiar, they’re all part of this banking problem and part of the challenge of managing safety performance, with useful lessons to help you keep your followers safe from harm.
Let’s start with your paycheck. That is the reason you do what you do, to make a living. It goes to a bank, meaning it’s an entry on the credit side of your ledger for your Case for Safety. With all the bad news circulating about banks, have you checked out your bank to make sure your hard-earned money’s safe?
I certainly have. A month ago, the thought would have never crossed my mind. No worries, right?
That’s what complacency looks like in real life. It can happen to anyone. Now failure is a big enough worry to warrant checking out the bank’s financial health, and perhaps having a look at deposit insurance coverage. If you don’t like what you find, you can decide to move your money to someplace you think is safe.
So much for taking the safety of your money for granted. That’s being prudent, not paranoid. But it is one more thing to worry about.
See what I mean about small things suddenly playing huge?
In the process of checking things financial out, you may have asked yourself, “What does “my money’s safe” even mean? Is there any bank too big to fail?” If so, you’re on to the subject of risk. It’s a term of art common to the vocabulary of managing money and managing safety. If only it meant the same thing in both places.
The English word risk traces back to the same place our numbers come from: Arabic. In the Arabic language “rizk” is a wonderful and complex concept that doesn’t lend itself to a one or two word definition. Rizk is the gift each of us has been given in our life: that gift might be a big family, a talent for music or the arts, athletic ability, or living a long and happy life. In a sense, rizk represents our individual Case for Safety: what we stand to lose with a serious injury.
However, in safety parlance, risk has taken on a variety of definitions. Risk may describe what can go wrong – hazards. It is used to rank consequences – fatality risk. It may be used as a verb – take a chance – or an adjective – at risk behavior. When the experts intone, “You must mitigate the risks” are they suggesting the hazard should be eliminated, the potential consequences lessened, or the probability of a loss decreased?
You see the problem.
In the language of finance, there’s none of that confusing double talk. Risk simply means the probability of losing money. No more, no less. That’s something universally understood – and acted upon, like in a run on the bank.
While there may be a nearly unlimited supply of ways to lose money, with people regularly inventing new ones like cryptocurrency, risk measures the odds of losing money. Not how, or how much, just the likelihood. Worried that your bank might go out of business, costing you money? That’s risk. Risk unacceptably high? You move your money.
Move your money somewhere else, does that guarantee that the next bank won’t fail? No. No bank is too big to fail. That’s why there’s deposit insurance. But insurance has its limits. If you buried your money in tin cans in the back yard, would that guarantee its safety? No. You might forget where you buried it, or you dog might dig it up and eat it for lunch.
The point is simply this: in finance, everyone understands there is always some possibility of losing money. There is no such thing as zero risk. Therefore, it’s a fundamental principle of money that greater the risk, the greater the compensation for giving someone your money. Because you presumed your account to be safe, your bank pays you next to nothing for the money sitting in your checking account; whereas the bank insists you pay them a lot for the money you borrow to buy a car.
That’s why a bank crisis upsets the apple cart: those assumptions get called into question, doubted, as well they should be. Turns out the depositors in bad banks weren’t being fairly compensated for the risk they were taking – the probability of losing their money. So, wisely they sought less risk elsewhere.
It makes perfect sense, and the world of safety would do well to follow the money. Do that, the first thing we’d understand in keeping ourselves (instead of our money) safe is zero risk does not exist. We’d then start asking, “What is the risk?” If the risk – probability of injury – is too great, we then do something the equivalent of moving our money, like stopping the job.
Or do something to reduce the risk. There’s not a job in the world for which risk cannot be decreased.
But that does require us to first be worried.
Have a crisis and something bad happens, there’s bound to be a call for accountability. This bank situation proves no exception. “Those who created this mess must be held accountable!” demanded one high level government official. Very high level.
If “being held accountable” is simply a polite way of saying punished, I’m not holding my breath waiting for that to happen. Those bankers who lost billions aren’t about to make restitution, and if they didn’t break any laws, they can’t be put in jail.
What’s the point of punishment anyway? It’s not going to undo the mess they created. Yes, it is a huge one that collectively “we” get to deal with – and will probably wind up paying for. Far better to have done something to have either prevented this melt down in the first place – or corrected the situation before it got out of hand.
That’s exactly what the management practice of “holding someone accountable” is capable of doing. Yes, in this case, we’re talking about hindsight, but the point here is to learn something useful from this mess. If this causes you to understand the practice of accountability, you’ll be the better for it.
Managing accountability is a powerful tool to change and improve individual behavior and performance. Yes, it follows a problem or a mistake; no, it is neither correcting nor punishing bad behavior. When properly executed, it sounds like a conversation, albeit a tough one. The conversation deals with duties, responsibilities, expectations, behavior, and consequences. The conversation delves into a follower’s decision-making process, and their acceptance and ownership of the problem, their mistakes, and its consequences, real and potential.
That’s a lot to talk about. For the most part, the process of managing accountability boils down to a leader asking a series of tough questions and insisting that they be answered. Not an interrogation, but rather an examination of conscience.
Managing accountability is the practice that separates the leaders who get great execution from their peers. Calling punishment “accountability” takes that practice out of the arsenal of leadership practices.
So, don’t. Find a different word for those kinds of consequences.
As valuable as the process is, managing accountability requires three things that are often in short supply:
- The proper understanding of what went wrong.
- Understanding how to execute the process of holding someone accountable.
- The willingness to hold people accountable.
Someone can’t be held accountable without the leader first understanding what went wrong, and what the follower did to contribute to the failure. This is not an investigation. If a leader thinks accountability is synonymous with punishment, game over. Since someone must “be held accountable” it falls to the leader drive the process.
All of which explains why, in practice, managing accountability proves to be the exception rather than the rule.