Reading a recent news article caused me to reflect on how risk and cultures are related. More importantly, they are critical to the success of a business or organization. Here is a very quick clip from the news article.
"The City of Portland, Oregon just drained off some 8 million gallons of its fresh water supply. Why? Because some kid decided to take a leak while hiking with some friends."
What's behind the story is probably a lot more important. Clearly the city water department didn't want to take any risk. Despite the dilution factor, as well as the fact that wild animals pass waste, die, and decompose in the water supply, a spokesperson for the department said that they decided to get rid of 8 million gallons of treated water because of public perception.
I say it was because people in bureaucratic organizations refuse to take risk. When you are spending other people's money, it's easy to waste it. There is no incentive to conserve money or spend wisely. After all, an employee is crucified for failing, but seldom rewarded for taking a chance that handsomely pays off.
If you want to have a successful organization you have to reward people for taking chances and being creative about solutions. You have to set up a culture that rewards reasonable risk and does not become so risk adverse as to cause people to become overly fearful of taking chances. No organization will ever serve the customer well and do it efficiently if it is unwilling to take reasonable risk.
