The document discusses key themes around risk and decision-making in local government based on interviews with practitioners. The main themes that emerged are: organizational learning, responsibility, processes, uncertainty, communication, bridging strategy and operations, and weighing evidence. Risk governance is important to create value and balance accountability, learning, and acceptable behavior. Decision-making involves uncertainty that requires both formal evidence and local knowledge to understand issues.

1. Uncertainty, risk and decision making in local government ‘Localism works’, LG Group Annual Conference, ICC Birmingham Simon Pollard, Sophie Rocks and Mark Smith [email_address] www.cranfield.ac.uk/sas/risk

3. What drives risk? (an analytic perspective) Potent hazards (sources) become available (pathways) to things we value (receptors), posing them harm (loss of value)

5. Risk domains in local authority settings Individuals care of elderly Authority initiated reorganisation Unable to control health pandemics Groups of individuals environmental pollution Risks to communities Risks from events Risks from decision making processes Risks to vulnerable adults

7. Methodology

9. Risk and organisational learning – the change agenda organisational value N Maturity Mode / Style Process characteristic and effect 5 Optimised Adaptive Double loop learning The organisation is ‘best practice’, capable of learning and adapting itself. It not only uses experience to correct any problems, but also to change the nature of the way it operates. 4 Managed Quantified Single Loop learning The organisation can control what it does in the way of processes. It lays down requirements and ensures that these are met through feedback. 3 Defined Measured Open loop The organisation can say what it does and how it goes about it but not necessarily act on its analyses 2 Repeatable Prescriptive The organisation can repeat what it has done before, but not necessarily define what it does. 1 Ad hoc Re-active Characterises a learner organisation with complete processes which are not standardised and are largely uncontrolled 0 Incomplete violation Incomplete processes, criminal, deliberate violations Interpretation of maturity level

10. Organisational learning - ‘maturity’ within public sector organisations (Marsh, 2009) present in silos process driven towards strategic value- added

11. Good risk governance creates value – a power utility’s risk journey in practice Process sophistication Organisational value Risk specialization Enterprise risk awareness Risk management integration Risk/mitigation optimization 6 months 12 months 18-24 months 24-48 months Senior Management and Board information needs evaluated; Preliminary risk profile developed; Policies established or refined; Standard terminology, techniques, documents established; Functional unit accountabilities clarified Risk Profile refined (focus is on residual risks and tolerances); Regular reporting to Senior Management and Board of Directors established; Corporate risk assessment embedded in business planning process; Local risk owners identified; local risk management expertise identified; skills and knowledge transfer occurring Corporate performance measures refined to recognize risk tolerances and priorities; Risk assessment and prioritization fully embedded in business planning; Risk profile interdependencies recognized; Local risk management processes fully active Clear ties between stakeholder value and risk management activities; Comprehensive risk portfolio created; new risk exposures identified early; appropriate priority and mitigation determined quickly; Risk management embedded all key business processes, including strategic planning; Local risk management processes fully aligned with Corporate objectives 3 (after Fraser, 2005)

13. The ‘Just culture’ movement – balancing accountability, organisational learning and acceptable behaviour Aviation and patient safety reporting; see Sidney Dekker and James Reason on balancing safety and behaviour . Signals – pay attention to them, investigate them, don’t normalise them Genesis of industrial accidents; see Andrew Hopkins on mindful leadership Situational awareness, cognition, task performance and team behaviours Cognition and human factors in the workplace; see Rhona Flin on situational awareness

14. Process – latent flaws in real systems (after, Reason 2000)

17. (Miles, 2002) Better risk governance - conclusions