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Corporate culture is intrinsically tied to risk adversity and the reason it's allowed to spiral out of control is because of costs that are difficult or impossi

Corporate culture is intrinsically tied to risk adversity and the reason it's allowed to spiral out of control is because of costs that are difficult or impossible to measure. If you can point to a risk and a cost associated with it while the detractors speak to morale or other intangibles you're going to win out in almost any big company. Is a drug testing policy going to keep you from hiring amazing employees? Quite possibly (the particulars of your industry and geographical area apply). But how do you measure that? No one is going to say "I didn't apply/take the job because I smoke marijuana on the weekends." Big companies miss out on opportunities and innovation because they allow risk adversity to take over their culture.

dragonwriter 11y ago
But what you describe isn't being risk-averse, its just prioritizing the obvious and easy-to-quantify risks (and ignoring other risks, including the higher-order risk of not conducting research to quantify the easy-to-identify-but-hard-to-quantify risks.) But being willfully blind to broad categories of risk isn't being risk-averse.
- brazzledazzle 11y ago
  Sure, but it is a symptom of a risk adverse culture. Risk adverse corporate cultures that pursue data that is difficult to quantify aren't exactly the norm. If your company culture values risk adversity why would you take the risk of measuring anything but the obvious? You might if you're that type of person, but risk adverse cultures select against risk takers.
  - dragonwriter 11y ago
    > Sure, but it is a symptom of a risk adverse culture. If there is aversion to risk involvedon, its not the company being risk-averse, its the individuals being risk-averse, and the culture having demonstrated that failing to address quantified risks to the company (but not failing to quantify and then, if appropriate, address identified-but-difficult-to-quantify risks to the company) will lead to negative personal consequences. But its not so much the aversion to risk that is the issue here so much as the particular personal risk profile in those environments. An environment with the same cultural degree of aversion to risk, but different personal risk profiles, would produce different outcomes. > If your company culture values risk adversity why would you take the risk of measuring anything but the obvious? Because the lack of knowledge about a risk (especially one that is identified and qualitatively characterized, but not quantified) is itself a risk, and if your company really values risk avoidance, than identifying and quantifying risks (and not just addressing the easily identified and quantified risks while ignoring the easily-identified-but-hard-to-quantify ones and the hard-to-identify ones) would be valued and rewarded.
    - brazzledazzle 11y ago
      >If there is aversion to risk involvedon, its not the company being risk-averse, its the individuals being risk-averse So would you be happy if instead of "risk averse company culture" I said "pervasive personal risk aversion driven by a company culture designed to punish failure and reward safe decision making"?

dragonwriter 11y ago

But what you describe isn't being risk-averse, its just prioritizing the obvious and easy-to-quantify risks (and ignoring other risks, including the higher-order risk of not conducting research to quantify the easy-to-identify-but-hard-to-quantify risks.) But being willfully blind to broad categories of risk isn't being risk-averse.

brazzledazzle 11y ago
Sure, but it is a symptom of a risk adverse culture. Risk adverse corporate cultures that pursue data that is difficult to quantify aren't exactly the norm. If your company culture values risk adversity why would you take the risk of measuring anything but the obvious? You might if you're that type of person, but risk adverse cultures select against risk takers.
- dragonwriter 11y ago
  > Sure, but it is a symptom of a risk adverse culture. If there is aversion to risk involvedon, its not the company being risk-averse, its the individuals being risk-averse, and the culture having demonstrated that failing to address quantified risks to the company (but not failing to quantify and then, if appropriate, address identified-but-difficult-to-quantify risks to the company) will lead to negative personal consequences. But its not so much the aversion to risk that is the issue here so much as the particular personal risk profile in those environments. An environment with the same cultural degree of aversion to risk, but different personal risk profiles, would produce different outcomes. > If your company culture values risk adversity why would you take the risk of measuring anything but the obvious? Because the lack of knowledge about a risk (especially one that is identified and qualitatively characterized, but not quantified) is itself a risk, and if your company really values risk avoidance, than identifying and quantifying risks (and not just addressing the easily identified and quantified risks while ignoring the easily-identified-but-hard-to-quantify ones and the hard-to-identify ones) would be valued and rewarded.
  - brazzledazzle 11y ago
    >If there is aversion to risk involvedon, its not the company being risk-averse, its the individuals being risk-averse So would you be happy if instead of "risk averse company culture" I said "pervasive personal risk aversion driven by a company culture designed to punish failure and reward safe decision making"?