May 26, 2010
The Grand Finale
By Melanie Lockwood Herman
It’s finale week on reality TV. Several of the most popular reality shows on network television wrap up this week, with winners
and “losers” receiving prize money, trophies, apprenticeships and recording contracts. In my experience many nonprofit leaders approach the process of managing risk as a seasonal exercise. In the view of some, the risk management process concludes with: the completion of a risk management plan, the formation of a risk management committee, or the discussion of critical risks at the spring board meeting.
A closer examination of the discipline of risk management reveals its unending nature. Sound risk management begins long before the participants enroll and continues long after the season draws to a close. Risk management is a year-round, rather than a seasonal activity.
This week a nonprofit leader contacted the Center to request a recipe for a risk management program. Just as altitude, oven type and cooking vessel affect the length of time required to bake the perfect cheesecake, there is no single risk management “recipe” that will work in many or most organizations. Yet like the basic ingredients found in the pantry of experienced home cooks, the ingredients of a successful program include:
- The willingness to examine past losses (including near misses) without losing focus on future possibilities;
- The commitment to engage and involve a diverse group of stakeholders in exploring the nature of risk in the nonprofit;
- An appetite for considering multiple versions of the nonprofit’s “future”;
- Appreciation for the need to explain the “why” behind the nonprofit’s safety policies as well as the “what”; and
- Patience in whatever dose is required to explain, demonstrate, coach, mentor, and model the changed behaviors and discipline thoughtful risk management strategies require.
Unlike the predictably short season of serial television programs, risk management has a long season. As you examine, re-examine and work to improve the strategies in place to increase the confidence of stakeholders, remember that what truly matters is the mission. I have a hunch that your commitment to the mission will inspire and sustain you in the journey.
Melanie Lockwood Herman is Executive Director of the Nonprofit Risk Management Center. She welcomes your feedback on this article and questions about the Center’s resources at Melanie@nonprofitrisk.org or (202) 785-3891.
Melanie’s most recent books include EXPOSED: A Legal Field Guide for Nonprofit Executives. Information on this book can be found at www.nonprofitrisk.org/store/hot.asp.
The Center’s 2010 Webinar Series continues June 2nd at
2 p.m. (Eastern) with the sixth program in the year-long series:
Shred or Retain? A Closer Look at Records Destruction/Retention Policies. For more information on the 2010 series, visit: http://nonprofitrisk.org/training/webinars/webinars2010.asp.
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Mark Your Calendar! 2010 Risk Management & Finance Summit for Nonprofits
The Center will host its sixteenth annual conference this October 10-12 at the Loews Hotel in
Philadelphia. Conference details will be announced in the weeks ahead. In the meantime, consider reserving your room at the Loews by using the hotel’s online reservations process. The process is explained on the 2010 SUMMIT page. Click here for details.