Nonprofit Risk Management Center A source for tools, advice and training to control risks ... so you can focus on your nonprofit's mission

August 25, 2010

One Thing

By Melanie Lockwood Herman

This week I’ve been attending a conference of association leaders gathered for a shared purpose: to re-energize. Of course there are many ways to define “re-energize.” For me (and I suspect for others), the opportunity to “re-energize” is the chance to unearth and adapt a new approach for managing the challenges that await me at home base. Visit a spa to rejuvenate and relax. Jump head first into an educational event to undercover ideas.

Many attendees say they are here to learn “practical approaches.” What is “practical” depends on the circumstances, perspective, past experience and sometimes the attitude of the workshop attendee. Like beauty, practical lies in the eyes of the beholder. Unlike some adult leaders, I don’t expect workshop presenters to deliver a long list of suited-to-me, ready to go strategies. I want and expect to learn, but I recognize that I will have to shape, adapt and custom tailor the “great ideas” to suit my needs. And my goal is modest: walking away from each educational session with one idea.

Who Are You?

During the wrap-up plenary session executive coach and author Marshall Goldsmith invited members of the audience to think of one thing or one way to change who they are. Goldsmith uses the term “identity” to describe how we make sense of who we are. He explains that one source of our identity is found in what others tell us about ourselves. Goldsmith says that identity based on what others think is reflected identity. Remembered identity is based on memories of events or circumstances. Let’s face it, it’s hard to let go of our personal loss experience. How we see ourselves may be based on life-changing or perception-altering experiences. Goldsmith says that programmed identity results from “other people sending messages about who you are or will become in the future.” When I was a young child my Dad often said, “You’re going to be a lawyer.” I regarded the prediction as nonsensical. As far as I knew Dad didn’t know any lawyers, had no practical experience with the legal profession, and he professed no psychic ability. After considering every other possible professional path I finally gave in to my programmed identity, I mean destiny, and reluctantly attended law school. The fourth category of identity is created identity, or in Goldsmith’s words, “the identity that we decide to create for ourselves.” We realize our created identity by taking practical steps to become the person we want to be—without being a “slave” to “the past or to other people.”

Risk Management Identity

Hearing Marshall Goldsmith’s keynote address reminded me of how many leaders approach risk management in their organizations. In some cases current risk management efforts are tied to past losses and events. Remembered events form the basis for action. Today’s risk management is focused solely on preventing the recurrence of unpleasant outcomes that remain burned in our memories. While that’s an important component of managing risk, it’s far from the whole picture. Another aspect of risk management activity is akin to reflected identity: obsessed with what others think and are doing. Many clients ask me to produce examples of risk management structures, programs or activities from “highly similar nonprofits” with the stated goal of not “reinventing the wheel.” Learning from others is an important part of effective risk management, but the answers to your nonprofit’s risk-related challenges and risk-taking opportunities does not lie in the files of another organization. Still other leaders seem compelled to implement new screening, supervision or program design elements because of community-wide or institutional pressure. They reluctantly agree to a programmed set of risk management strategies as an alternative to diving in and creating something that will better meet their needs.

My sense is that nonprofits are best served by leaders willing to create risk management structures and programs that meet the organization’s needs today while instilling an early warning system for events in an uncertain future. And that means leaving the chisels at home: effective policies should not be chiseled in stone. They must be flexible and subject to ongoing review as the nonprofit examines and adjusts to its shifting circumstances and environment. A created risk management effort may take more time than one based on past losses or copied from the pages of another’s playbook, but the ultimate reward is an organization that is far more agile in an uncertain world and resilient to the risks that are impossible to forecast.

One Change…

As you think about how to evolve your risk management efforts from a remembered, reflected or programmed mode to a program of your making and shaping, consider the educational opportunities available to you and others with responsibility for risk management. The more you learn, the better equipped you will be to create strategies that build the risk-taking muscle of your nonprofit and its resilience.

I want to close this week’s column on the topic of “one thing” with a suggested next step. I invite you to identify the ONE CHANGE you will make that could increase the effectiveness of your risk management activities. If you’re willing, send me an email with a short description of your “one change” and I’ll publish a summary of the changes we’re all making in next week’s enews.

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 or (202) 785-3891.

Melanie’s most recent books include Ready…or Not: A Risk Management Guide for Nonprofit Executives. Information on this book and other recent Center publications can be found at

Learn more about remembered, reflected, programmed and created identity in Marshall Goldsmith’s book, Mojo: How to Get It, How to Keep It, How to Get It Back If Your Lose It. The book is available at major online booksellers and can be ordered through

Ten Things

If you’re feeling ambitious and like the idea of educational programs that offer a handful of tips and strategies, you won’t want to miss the Top 10 workshop series at the 2010 Risk Management and Finance Summit for Nonprofits, scheduled for October 10-12, 2010 at the Loews Hotel in Philadelphia. To view the interactive conference brochure, click here.

REMINDER: The early-bird deadline and discount expire on August 31. All early-bird, paid registrants will be entered into a drawing for a new 16G iPad. Sign up to attend the Summit today.

If resource or time constraints make your participation in the Summit impossible, consider opportunities for distance learning. Details on the Center’s informative Fall webinars can be found here. Next up is our program on the risk management benefits components of staff and volunteer Orientation, Education and Training. Head “back to school” by attending our September 1 webinar or by joining us in Philadelphia this October 10-12 for the 2010 Summit.

Coming Soon: The Summer edition of Risk Management Essentials will be available on the newsletter landing page later this week. Mark the page and check back to read articles on “Enforcing Board Member Responsibilities” and “Managing Reputation Risk.”

Pass it On!

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© 2010 Nonprofit Risk Management Center