Risk Shrink: The Human Element Risk
There is a certain beauty in working with numbers. They can be collected, averaged, analyzed and combined to create new definitions and projections. In business continuity, we rely on numbers to determine the likelihood of an event occurring, and how best to offset it.
Humans base risk-related decisions on two systems of thinking, the intuitive and the analytical (Gardner 2008). Most of us are familiar with the analytical side of risk, as in the case of auto insurance. Actuaries compare your key characteristics against the national claims averages of others like you to determine the premium you must pay to offset the company’s financial risk in possibly having to pay for your accident.
This system of thinking is logical, affirming our ability to make better judgments about risk using clear statistics like hazard, exposure, consequence and probability. The analytical system works slowly; it examines, calculates and considers all evidence. A decision based on facts is easy to explain, as in this common equation for risk: Risk = Probability * Impact.
While this equation has long been used to measure risk, the risk management community has seen the value of a missing variable — perception. What we believe or do not believe about risks has an enormous effect on how well we prepare ourselves for them and the action we take when they occur. This is where the intuitive system of thinking comes into play. As it works without our conscious awareness, the intuitive system is automatic, emotional and swayed by our culture, social environment and personal experiences.
The psychology of risk is a burgeoning topic. We are just beginning to research and understand patterns of perception, processing and response to threats. While there is a lot we don’t know, having an understanding of the patterns discovered so far can better prepare us to recognize these patterns when we encounter them in real life.
Journalist Amanda Ripley has reported on human response and survivor stories in recent natural and manmade disasters. After being instructed to evacuate for a hurricane or flood, most people check at least four sources (e.g., family, neighbors, news sources, officials) before actually deciding to leave (Ripley 2008). In such a situation, while the facts are straightforward — there is a hurricane coming — and the logical response is to get moving, our intuitive system still demands confirmation from familiar sources before encouraging action.
Familiarity breeds trust. Therefore trust in the source of a communication, regardless of how serious or accurate the information, is critical in predicting behavioral outcomes. Decisions based on trust or other value-based factors are hard or even impossible to explain because they are based on automatic settings operating within our unconscious. This makes our simple equation less easy to compute: Risk = Probability * Impact * Perception.
If value-based factors such as trust are so difficult to pin down, and vary for each individual, why do we need to take them into account when managing risks? These additional considerations not traditionally factored into the analytical system of thinking explain why our fears don’t always match the facts, cluing us in to how our perceptions can completely alter the outcome of an incident.
Let’s examine what factors into fear. Most of us are more concerned about a plane crash than an automobile crash, and more fearful of sharks while at the beach than of developing skin cancer. In reality, it is 67 times riskier to travel the same distance by car than by plane, and annually there are only 6 deaths from shark attacks compared to 48,000 from melanoma (Sunstein 2002). So what drives this false sense of risk?
Sunstein (adapted from Paul Slovic, 1993) has identified several common factors that influence our perception of risk, including:
- Catastrophic potential: If fatalities occur in large numbers in a single event (instead of dispersed over time), our perception of risk rises.
- Familiarity: Risks that are new or rare cause more fear than familiar ones.
- Understanding: If we believe that how an activity or technology works is not well understood, our sense of risk goes up.
- Personal control: We worry more if we feel the potential for harm is beyond our control (e.g., a passenger in an airplane versus a driver of a car).
- Media attention: More media attention to a risk means more worry.
- Dread: If the effects generate fear, the sense of risk rises.
- Future generations: If the risk threatens future generates, we worry more.
- Accident history: A history of bad events boosts the sense of risk.
- Reversibility: If the negative effects of an event cannot be reversed, perception of the severity of risk rises.
- Origin: Man-made risks seem more threatening than those of natural origin.
- Timing: More immediate threats loom larger than those whose impact will not be felt for some time.
The above factors influence how we perceive a risk, threat or incident and will subsequently influence our response, given that perceptions often override facts. This is important to understand when thinking about how people will respond in a crisis.
The Impact Of Stress
In a crisis, people behave in unexpected ways. You cannot know how you will respond until you are actually facing a threat, regardless of how much you have thought about or anticipated the event. There are many options we are faced with in responding to an incident, and we either consciously or instinctively make a choice about how to react.
When we consider how we process information related to risk and incidents, we must look at the way our systems are affected by stress. Stress is not an element that is exclusive to disasters or incidents; some studies indicate we respond to some level of stress 100 times a day. But when we are faced with a life-or-death situation or a terrible incident, these stress levels can skyrocket way beyond what we are used to dealing with. When our stress levels are out of control, we often find our mind, and sometimes even our body, also out of control. Learning about how stress and fear affect our mind and body can help us anticipate behaviors that can facilitate or inhibit a successful response to incidents.
Some common sources of disaster-related stress include a threat to our values (our core belief about what is right and wrong), our personal finances, our family and our beliefs about the world. We don’t feel in control of what happens, and we don’t know what’s going to happen or how much of our own actions might influence the outcome. We don’t know if what we are doing is right. We are forced to act and respond very quickly in many incidents without time to weigh the options and outcomes like we normally do. We don’t have enough information about what is happening, what has happened, how it has affected things, or what it might affect further down the line. All of these contribute to stress in respondents of disaster, particularly for those with a leadership role whose decisions will affect others.
Particularly for those of us serving in crisis team roles during an incident, another source of stress comes from tending to our personal life and our work life. For incidents that affect the region and not just your company, our personal life is also likely to come into impact with the incident. Even when the incident is contained to the workplace or the home environment, stresses from one environment are likely to weigh on the other.
This leads to what is called “person-role conflict,” which refers to the tension between our personal and professional roles and responsibilities. Members of a business continuity or crisis team will be expected to spend many hours resolving the incident and contributing to recovery of the site. If you also have a lot of demands for attention from your personal life, or if you are concerned for the welfare of your loved ones, it can be challenging to focus your attention on the company’s recovery, and difficult to cope with the stress from balancing both environments (Greenhaus & Beutell 1985; Kahn, Wolfe, Quinn, Snoek, & Rosenthal 1964).
When under severe stress or fear, our ability to intake and interpret information falls drastically. Message retention falls by 80%. Some of the ways we cope with this is by reducing complexity of the information heard; acting on our pre-existing beliefs; seeking analogies in the current situation to problems we already understand; and eventually, blocking out new information when it becomes too much to process.
Understanding this is critical to communicating with others during an emergency. One way to treat this is to focus most on what people hear first. Get to the point by giving key information first, instead of bombarding your audience with too much (Covello 2010).
Given the difficulties associated with communicating during stressful situations, it is critical to communicate regularly prior to an emergency. Consistent communication of information needed during an emergency will allow for internalization of the information for when it might become relevant. Developing and testing communications is crucial for ensuring that recipients understand information as intended.
One of the ways stress impacts our ability to successfully respond to an incident is through its impact on our decision-making abilities. If our stress level has crossed over into the “too high” zone, it will be difficult to think rationally, and in stressful incidents we won’t have the information, time or mental capabilities to use our typical reasoning processes.
One manifestation of this impact to decision-making ability is known as “Cognitive Lock-In.” Since our ability to intake information is reduced when under stress, our more complex reasoning capabilities decrease. This results in a tendency to make an initial decision, and stick with it, despite later information indicating a better course of action. In a state of intense concentration, decision-makers desperately want to solve problems; new information or evidence that distracts from what has already been decided as a good solution is sometimes treated as distracting or annoying for causing “cognitive dissonance,” and we may disregard important new information after we have “locked in” to our early decision (Rouse and Morris 1986).
Another way decisions are often affected is by what is known as task saturation, or a focus on solving small problems and losing sight of the big picture (Dörner 1997). A strong desire to solve problems in a crisis can manifest in a tendency to hyper focus on smaller problems or find relief in manual labor that can create a feeling of contributing to a solution. While small problems and physical problems are important, we have to keep sight of the big picture.
A third common way we rush to decisions when forced to make decisions under stress is known as “Groupthink.” Groupthink references a condition where group members are more eager to come to an agreement and minimize group conflict than to come to the right decision (Kamau and Harorimana 2008). It has a tendency to happen in close groups when put under stress, and people may censor themselves or refute contradictory evidence to maintain the decision of the group. Groupthink can affect even seasoned problem-solvers if the mix of people in the group comes from a similar background, and particularly if there is a very assertive leader.
This impact on decision-making can affect even very savvy leaders under times of stress. This is one of the reasons why planning is so important. Thinking through the decisions you will have to make while you are not under the stress of the incident helps ensure that you are thinking rationally and making well-thought-out decisions.
By increasing our knowledge about what drives fear and behavior, we can improve communication and training around these elements to gain a greater sense of control over our risk environment, lessen our distress of the unknown, and become better prepared to react.