17
Nov

0

A Heavenly Risk: Force Majeure (Black Swan Effect)

Two years of drought, killing livestock, seen an increase in food prices has been everyone think and work towards survival. The water restrictions and the punitive system implemented to build strong Internal Control environments to manage these risks, created the survival mode and culture across the country.

Then on 9th of November, the heavens opened and this caused havoc. 90mm in an hour in a concentrated area and no infrastructure (people, processes of technology) was ready for the mass of water. People drowned, children got swept away and are missing, and yes, people tried to survive the other end of the scale.

What did we learn?

  • People are not prepared (jump into flooding waters, don’t know what to do when car is sinking or being swept away by the water),
  • People are risk takers (come hell or high water, I will get home in time),
  • People do not quickly adapt to situations (Always the total surprise element and crisis mode, instead of be calm and manage the situation),
  • Drivers don’t know how to drive in these conditions (Business, speed and late breaking as usual)
  • People are risking their lives to be close to resources (Alexandra river system).

I can go on. Why are people not applying their risk management skills or experience in these situations? Force Majeure is a Black Swan Risk event.

This is all about making the right decisions, preventative if possible and ensure in these situations that logic outranks your urge for survival in the Fight or Flight mode.