October 19, 2011

New! — 2nd Edition of Ready…or Not Released during Risk Summit

At the annual Risk Management & Finance Summit for Nonprofits held in Seattle earlier this month, the Nonprofit Risk Management Center released the 2nd edition of Ready…or Not: A Risk Management Guide for Nonprofit Executives. This easy-to-read, practical guide addresses topics ranging from risk awareness to calibrating risk appetite. Authored by Melanie Herman, the Center’s executive director, Ready…or Not invites readers to embrace risk-taking in their organizations while paying close attention to stakeholder perceptions, risk communication and the relationship between risk and strategy setting. The 2nd edition features updated content throughout, including brand-new chapters on “human factors” in risk management and risk awareness/risk appetite. Learn more or order a copy today, here.

Brain Freeze

By Melanie Lockwood Herman

Once again I’m intrigued by and caught up in the latest research and analysis on the human brain. I’ve been re-reading “The New Science of the Teenage Brain,” featured in the October 2011 issue of National Geographic, and I’ve begun reading Michael Shermer’s new book, The Believing Brain.

Both publications offer fascinating insights on human behavior and brain chemistry. David Dodds, author of “The New Science of the Teenage Brain,” explains two reasons why teens—more than other age groups—prefer the company of peers. The first reason, according to Dodds, is “attraction to novelty.” My teenage daughter’s age-appropriate friends offer more “novelty” than her familiar, boring mom. Dodds adds, “…teens gravitate toward peers for another, more powerful reason: to invest in the future rather than the past. We enter a world made by our parents. But we will live most of our lives and prosper (or not) in a world run and remade by our peers. Knowing, understanding, and building relationships with them bears critically on success…This supremely human characteristic makes peer relations not a sideshow but the main show.”

Apparently our chemical attraction to peers—which reaches its pinnacle during adolescence—continues in adulthood with the preference for the familiar. In The Believing Brain, Michael Shermer notes that "…our evolved tribal tendencies lead us to form coalitions with fellow like-minded members of our group and to demonize others who hold differing beliefs." I’ve witnessed the fear of peer exclusion in my role as a parent and the lure of like-minded souls in the nonprofits who reach out to the Nonprofit Risk Management Center for support and assistance on a wide range of risk issues. Last week I had the opportunity to work with the leaders of a large nonprofit in the vetting of candidates for a brand-new CFO position. As I participated in that process, I was reminded of the importance of:

• Being open to a leader whose world view and life experiences are different from your own. During interviews with prospective staff, many executives emphasize the “mission” and “values” of their organizations. Candidates who profess a sincere commitment to the mission are those most likely to proceed to the next step. I can’t help but wonder if in emphasizing “buy in” we miss the opportunity to engage leaders who can help us evolve our organizations.
• Recognizing the need to work through issues that arise when competent people with different work styles come together for a common cause. High tech gadgets and productivity tools are of little use when personality and work style clashes occur in the workplace. We must commit to acknowledging and addressing the inevitable discord that occurs when people of diverse backgrounds meet in the nonprofit’s physical or virtual workplace.
• Guarding against the attraction to a candidate who most closely resembles a departing staff member. I’ve heard countless board chairs make comments along the lines of: “We would have a hard time replacing our CEO if she left. There’s no one quite like her.” The departure of a charismatic, effective CEO is always an opportunity to look at the nonprofit in a new way, and reconsider the organization’s future possibilities. Boards faced with the “dilemma” of replacing a valued executive should embrace the opportunity.

New research on brain chemistry offers wonderful insights into human behavior. And gaining a deeper understanding of human behavior is essential to both managing risk and investing in the future of the nonprofit organizations we serve.

Melanie Lockwood Herman is Executive Director of the Nonprofit Risk Management Center. She welcomes your ideas about any risk management topic, feedback on this article and questions about the Center’s resources at Melanie@nonprofitrisk.org or (202) 785-3891. The Center provides risk management tools and resources at www.nonprofitrisk.org and offers consulting assistance to organizations unwilling to leave their missions to chance.

Previous eNews articles on neural science and risk include:

It’s a Right Brain, Left Brain World

Calling All Factions

Reality Check: The Myth of Multitasking and Debunking the Blame Game

Learn to Embrace Risk

Whether you’re trying to understand your nonprofit’s appetite for risk-taking, sharpen your risk management skills, evaluate your Enterprise Risk Management (ERM) journey, or educate your board about risk-taking and risk management, don’t hesitate to reach out the team at the Nonprofit Risk Management Center for assistance. We can support you in a number of ways, from helping you draft or revise risk management policies to designing custom training programs (on-site, virtual/webinar, or online). We also offer in-depth risk assessments, Enterprise Risk Management engagements, and advice and consultation on topics ranging from developing or updating youth protection policies, to strengthening governance practices. Why make the journey alone when you can partner with a team of nonprofit specialists who live and breathe nonprofit sector risks? Contact Melanie@nonprofitrisk.org or call (202) 785-3891 to discuss your needs and learn how we can help.