There are lots of gray areas in professional regulation – gaps and overlaps in legislation within and across professions and different rules from one jurisdiction to the next. Now software is presenting some new and different challenges. Continue reading
Many years ago we would never have thought that there is code that determines who we are. Now we understand that DNA is the ultimate example of structured information.
Thin slices of related information paint a composite picture
The way the human the brain serves up the right information in a split second is truly inspiring. How do you explain now retired Magic Johnson’s court sense and ability to float through a seemingly impossible line of guards and then sink a basket making it look like poetry in motion? How do you account for Wayne Gretzky’s renowned ability to anticipate where the puck will be at a critical moment?
Malcolm Gladwell in Blink uses examples like these to illustrate the brain’s capability to process thin slices of related information and make fast and accurate decisions. “Blink” is Gladwell’s metaphor for split second decision making.
This capability to thin slice accurately is based an acute understanding of what’s important and what’s not. The composite picture that the thin slice represents may include seemingly trivial information and exclude other information that just doesn’t fit. It’s the right bits of information and relationships between them that matters.
The concept applied to regulatory organizations, and in particular to the development of risk profiles, can be very effective. Continue reading
The essence of the Internet is that it’s very open, decentralized and populist; a place where knowledge is democratized and mass collaboration is the source of power. It challenges organizations, institutions and systems that are just the opposite; human structures that are confidential or closed, centralized, designed for creating proprietary intellectual products, organized on authority principles, and where power is maintained by controlling knowledge.
So we’re witnessing a revolution spawned by the Internet that’s growing and morphing. There’s no stopping it and there can be no debate that the previous way of being organized and working that ruled last century was better (or worse.) It doesn’t really matter. The genie is out of the bottle and we need to understand how we’re going to adapt to the unanticipated events (risks) that will be driven by the new order of the Internet.
Right now, I believe that the stage is being set in the politics of Canada for a new set of entirely unanticipated events driven by this new way of doing things, made possible by Internet technologies. How this will affect regulators, more on that later, but consider the scenario that’s unfolding.
I spoke at a conference in Ottawa today that was focused on the topic of stakeholder consultation. An observation from one of the participants in one of the sessions raised the question about how to authenticate and validate comments from participants received via an online forum, wiki, or blog. If the comments are to be used to inform policy, the need to know the author of a comment is clearly important. If one individual or group were able to represent themselves as many individuals or groups, the consultation process is clearly suspect.
This brings up the question of the purpose of the consultation. In risk management, we need to consult to understand matters that would otherwise be invisible, to see and understand more clearly what and how certain unexpected events could happen that will advance or retard goals. The authenticity of the individual who helps you understand or see more clearly may not be important. However, the truth of what they tell you is. So we need to validate the information. It’s less likely that we need to validate the reporter. Indeed, knowing less about the reporter means that it is less likely that we will be influenced by the things that shouldn’t influence us, but easily can. For more on this point about risk and perception read this blog about Joshua Bell.
For public sector risk managers here’s a poignant example of the difficulty of assessing risk, either threats or opportunities, on their own merit, stripped of the context. Context, while important, can make us blind.
The example below challenges our idea of what’s great versus what’s just … ho-hum. How do we know that something is great.
The story is based on a “stunt” that the Washington Post and Joshua Bell played on DC Metro commuters. Bell performed for commuters as might any street musician; not withstanding his reputation as a renowned virtuoso violinist, nor the fact that he was playing the world’s greatest music that few people can perform convincingly, nor that his instrument was a handcrafted Strad, made in 1713 by Antonio Stradivari.
A onetime child prodigy, at 39 Joshua Bell has arrived as an internationally acclaimed virtuoso. Three days before he appeared at the Metro station, Bell had filled the house at Boston’s stately Symphony Hall, where merely pretty good seats went for $100. Two weeks later, at the Music Center at Strathmore, in North Bethesda, he would play to a standing-room-only audience so respectful of his artistry that they stifled their coughs until the silence between movements. But on that Friday in January, Joshua Bell was just another mendicant, competing for the attention of busy people on their way to work.
The above passage is from the Washington Post article. It’s a great read. What happened? There was lots of great music making. You can listen to it! However, very few people that passed him on their commute recognized that they were hearing truly great music. Indeed, far fewer than the Post or Bell expected.
How does this apply to risk management?
- Context adds or subtracts significantly to our appreciation of an event or situation; we may need to strip the context away to reveal the heart of the matter
- The elements of the risk framework need to be in place: training, perceptiveness, interest or motivation and a supportive structure are needed to identify opportunties and threats, or to really hear the music
Curious to hear your thoughts.
Regulations capture knowledge at a point in time
Intensive research and analysis contribute to the substantial body of knowledge that’s developed when creating or updating regulation. It involves ideas, trade offs, drafting and revising documents – for months or, more likely, years. The resulting legislation, regulations, policies, standards and programs capture all of this distilled knowledge at a point in time. But this is just the beginning â€¦
Risks evolve faster than rules
Issues shift and risks change. Moving forward, there are endless uncertainties about the future. It doesn’t help that rules are static. Continue reading
By Connie McCandless
For regulators in all jurisdictions, it’s the uncertain behaviour of people that’s the root of many difficult problems. People and uncertainty go hand in hand. All the possibilities of what can happen haven’t been considered, nor can they be.
People, whether they’re part of the system of regulation or the regulatees, may be defiant or cooperative, disinterested or informed, incompetent or proficient, dishonest or honest.
It’s always a shock to discover dishonesty in a system that demands just the opposite. In my hometown of Toronto, it was shocking to learn that lottery ticket sellers have been defrauding jackpot winners. So in Ontario, The Ontario Lottery Commission is about to be regulated.
Human behavior is a key risk variable. Regulations that are intended to promote desired behaviors often have unintended negative consequences. To achieve their objectives, regulators are advised to employ a variety of controls and incentives consistent with the rich possibilities for how people may respond.