Author : Vojtech Vohanka
INSIGHT
SIRS
How can theories of risk and security help us to understand perceptions of risk and the impact of communication on these perceptions? Risk has always complicated and affected people’s lives. When it comes to managing risk, we are confronted with a range of possible options and alternatives on regular basis. Risk is viewed as the level of doubt in the outcome of our activities. There is no risk-free element in our existence. Due to the fact that we constantly reside in an unsafe universe, security responsibilities have grown. In my opinion, it is therefore paramount to know the theoretical background to become more confident in handling risk (Borodzicz, 2005).
The purpose of risk perception is to measure risks by applying an approach in which the individual base elements of the system are first specified in great detail. This method presumes that all risks can be either mitigated or reduced to a satisfactory degree. Psychologists understand risk as an open-ended concept, appropriate for work using ‘quantitative analysis’. Psychologists have also studied risk perception further and observed that humans are generally frightened when confronted with unfamiliar risks as opposed to well-known ones (Borodzicz, 2005).
This paper has been divided into three parts. The first part will provide definitions of what security, risk and perception of risk are. The second part will summarize main security and risk theories, giving evidence of how they generally characterize study of risk and security. The final part will examine the connection between the theories and perception of risk. This analysis will also concentrate on the possibility of corporations influencing this perception when they communicate risk to global society. In conclusion, the essay will link the main ideas and provide a final response to the essay question.
Some theorists have indicated that societal and governmental transitions have led to greater improvements in the way in which risk is identified and controlled in modern society (Borodzicz, 2005). Beck (1992 as cited in Borodzicz, 2005: 10) claims that we remain in a situation of significant change from a ‘class’ to ‘risk’ society. Beck also assumes that current innovations regarding risk are resolved by the world of business and commerce. Beck defines this process as a ‘calculus of risk’, created from a variety of private and public insurance opposed to financial obligation. The calculus of risk operates on the foundation of four fundamental principles, namely: ‘limitation, accountability, compensation and precautionary aftercare’.
The Institute of Risk Management (IRM) describes risk as a mixture of the likelihood of an action and its outcome. Obviously, outcomes can vary from optimistic to pessimistic (Hopkin, 2012). Risk has recently come to be the main concern for every enterprise that seeks to reduce corporate liability where risk is involved, particularly those key threats to its business operations and growth. Risk is now much harder to control since it can no longer be divided into two categories, ‘speculative’ and ‘pure’. Numerous insurance companies are clearly unwilling to provide cover for ‘pure’ risks without first investigating the risk prevention strategies in place in organizations (Borodzicz, 2005).
Hood (1992 as cited in Borodzicz, 2005: 13) suggested that risk can be described as an ‘archipelago, a group of islands, each [representing] a particular sub-discipline or associated area of expertise’. For this reason, risk has surely become an extensive field of study. Risk analysis then assigns an evaluation to the connection between likelihood of possible physical loss and its importance. This technique provides guidance on how to prevent, remove or decrease possible threats. Additionally, it helps organizations to estimate the expenses and advantages of risk management, authority, retention or relocation (Borodzicz, 2005).
Maslow (1968 as cited in Borodzicz, 2005) argued that security is a necessity for the human race as well. According to the Oxford English Dictionary (2013), security is defined as a condition in which a person feels free from something that may cause them harm or injury. Security is deemed to be the main component of risk management, based on holistic thinking and our past experiences of risk. In a realistic manner and from a corporate risk position, security can in itself entail risk if poorly organized. As a result, security management certainly includes an operational expense to any organization, but at the same time it poses a serious threat if handled badly (Borodzicz, 2005).
Psychologists seek to better understand the nature of risk by segregating a distinct feature of the variables which is then subjected to further analysis and inquiry under empirical conditions. This research normally involves a set of questionnaires in which the respondents are asked how they would respond to specific hazardous situations. For the purpose of determining variety of risks that concern individuals, this research would try to quantify how a cross-section of
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people handle risk. This system is defined as a ‘psychometric approach’. In addition, Starr (1969 as cited in Borodzicz, 2005) maintains that risk perception depends on circumstances, way of life and ‘psychical reality’. Psychometric approaches in fact take into account the qualitative features of hazards. Consequently, unprofessional individuals were included in a significant research project in 1978 in which they were asked to reflect on past experiences of well recognized hazards, for instance: emergency situations posing danger to lives and properties. At that time, these opinions were compared with genuine degree of mortality (Borodzicz, 2005). This analysis firstly allowed theorists to estimate the equivalence among ‘human perceptions in relation to a substantive measure of risk’ (Borodzicz, 2005: 19).
From another standpoint, it is hard to determine the seriousness of a person performing the project and the degree of understanding between that individual and a research worker. An additional issue with these approaches is that they do not look at the selection of ‘risks and weightings’ which humans bring with them (Borodzicz, 2005). Trist et al. (1963 as cited in Borodzicz, 2005) reported that ‘socio-technical approaches’ in managerial environment refer to the activities initially performed at the Tavistock Institute, which dealt with issues created by the transformation of ‘British coal industry’. Trist et al. also declare that this study is an initial theory of ‘organizational health and work’ efficiency. They describe several advantages originating from corporations viewed as evident ‘technical systems’ which shape and react to extensive territory. Those involved in emergency management have emphasized the relevance of ‘systems theory’. They claim that serious events can be basically understood as ‘systematic failures’ as well (Borodzicz, 2005). Horlick and Jones (1990 as cited in Borodzicz, 2005) additionally contend that systematic failures can generally be traced back to individuals or mechanical breakdowns of running a business.
Starr (1969 as cited in Borodzicz, 2005) differentiated between ‘voluntary’ and ‘involuntary’ risks. He further claimed that a person’s perception of risk can be influenced by his/ her voluntary involvement in external risks beyond their physical control. He characterized a number of ‘involuntary’ risks affecting the population. Furthermore, Otway and Von Winterfeldt (1982 as cited in Borodzicz, 2005) insisted that a range of pessimistic hazard elements impact on human risk perceptions. In order to analyze risk, every ‘risk measurement’ must be completely understood. There is a drawback with this kind of ‘psychometric approach’: as soon as the sets of questions are prepared, respondents can only provide answers to the hazards cited. Hence, the connections among unforeseen risks and alternative elements would not be recognized and taken into consideration. The difficulty in designing questionnaires on risk perception stems from the closed-nature of the questions which does not allow open responses, thus accepted findings in this area may require further investigation (Borodzicz, 2005). In other words, ‘the tip of a highly complex social and cultural iceberg [has] been found’ (Borodzicz, 2005: 22).
Nevertheless, it has been debated whether or not ‘social and technical systems’ are comprehensive methods of business activities. Turner (1978 as cited in Borodzicz, 2005) expressed that it is based on recognizing a disaster as a ‘socio-technical’ issue with its processes to be closely examined. He also indicated that disasters can be considered as originating from efforts to deal with situations in which the existing and desired state are unclear and conditions had not been met prior to the incident. Toft and Reynolds (1994 as cited in Borodzicz, 2005) supported Turner’s opinion and claimed that the manner in which numerous disasters are understood needs to be re-evaluated. The link between the social and technical attributes of the Turner’s model may grow stronger over time, creating a situation in which an accident is likely to occur.
Kahneman and Tversky (1979) developed the ‘cognitive processes’ of reaching decisions. Gardner (1987 as cited in Borodzicz, 2005) reported that people can make decisions in an irrational manner but with scope for wrong choices to be corrected. Lopes (1987 as cited in Borodzicz, 2005) explained that risk relates to the combinations of circumstances and outcomes which rely on presumptions. Lopes’ field of study is important in terms of classification of ‘motivation influencing choice’. This technique aims to uncover the benefits of choices generated by persons. Moreover, Lopes proposed the notion of a ‘risky choice’ which can modify behaviour of the individual, often requiring them to give careful thought to the processes regulating decision-making.
Toft and Reynolds (1994 as cited in Borodzicz, 2005) report that Turner’s model comprises six steps. In the first phase, the principles and methods of operation in an organization are formulated. In the course of the second step, the operations managers may discover that there is no previous evidence of a crisis, in which case they will have no proven strategy to employ in the event of an emergency. The third phase seeks to provide a solution to the issue of potential threats through the set of conditions established in the first step where no previous guidance exists. The fourth step is to establish an emergency scenario which has not been applied earlier.
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The fifth phase is the recovery procedure. The sixth step is the process of learning from mistakes and self-reflection on the part of the management based on what has occurred. As a result, where feasible, it is advisable to implement these emergency arrangements without delay in order to prevent losses (Borodzicz, 2005).
This theory can be applied to numerous types of hazards, but it has been heavily criticized due to the notion of a permanent degree of risk. In spite of that, this hypothesis provides key inquiries for authorities. Consequently, in order to improve safety and to avoid creating further risks, laws and regulations must be formulated cautiously. This technique must also be considered in the context of the ‘organizational safety culture’ (Borodzicz, 2005).
Toft and Reynolds (1994 as cited in Borodzicz, 2005) indicated that ‘isomorphic learning’ analyses operation practices which are prevalent everywhere and fundamentally the same. Although disasters are generally sporadic incidents for a single corporation, they are much greater for a whole industry. For this reason, the connection between an industry and each organization is paramount especially in terms of ability to obtain knowledge and skills from their experiences. Walsh and Healey (1987 as cited in Borodzicz, 2005) mentioned that when a disaster happens, it normally ‘beats’ everyone, specifically those who have not been proactive. On the other hand, humans frequently appear to have been shocked into inaction and indecision in the case of former disastrous episodes.
The expression ‘culture’ in connection to risk has influenced a number of theorists in various social disciplines. These individuals have evolved two approaches defined as ‘safety culture’ and ‘cultural theory’ (Borodzicz, 2005). Pidgeon and Turner (1991 as cited in Borodzicz, 2005) indicated that ‘safety culture’ produces a system for understanding the risk management measures in dangerous commercial activities which can be applied to examine the necessary conditions for myriad ‘socio-technical’ disasters. The Advisory Committee on the Safety of Nuclear Installations (ACSNI) (1993 as cited in Borodzicz, 2005: 41) characterizes the ‘safety culture’ of a company as ‘the product of individual and group values, attitudes, perceptions, competencies and patterns of behaviour that determine the commitment to and the style and proficiency of an organisation’s health and safety management’. Companies with an effective ‘safety culture’ are identified by relationships based on common ideas, beliefs, awareness of well-being and deterrent actions. Moreover, these theorists claim that if the safety culture of an institution ameliorates, business productivity will grow simultaneously. Accordingly, a company with a satisfactory ‘safety culture’ will improve its profitability and well-being (Borodzicz, 2005).
Perrow (1984) claims that the majority of disasters are impossible to prevent due to our complex ‘technological society’. According to Perrow, the implementation of ‘high risk systems’ is an attempt to assert control over external threats originating from our surrounding environment. He states that complex approaches to dealing with emergencies have a greater likelihood of systematic failure as there are more elements that can go wrong. As an analogy, it can be compared to a domino effect; if one falls, the whole structure collapses. He describes these events as ‘normal accidents’. From another point of view, Perrow’s statement seems to present a couple of difficulties. Firstly, these characteristics can be identical or related instead of separate. Secondly, it is a question of recognizing the difference between these features compared with their utilization in emergencies. Time is the most crucial aspect of Perrow’s theory. He contends that within the time frame of a given crisis, some strategies employed in an emergency carry a calculated and therefore acceptable level of risk, while others are an unknown quantity and for that reason, should not be attempted. As determined by Perrow, the interpretation of probability should not be the only model used for minimizing risk (Borodzicz, 2005).
Culture can also be viewed in relation to two features: ‘cultural biases (group)’ which are represented jointly by common principles, ideas, traditions of the group and ‘social relations (grid)’ that are explained as a structure of association between individuals. As stated by Douglas (1970 as cited in Borodzicz, 2005), ‘group’ stands for the participation in events of a delimited organization, whereas ‘grid’ relates to the concepts of a self-interested individual. Thompson et al. (1990 as cited in Borodzicz, 2005) report that ‘grid’ means forms of relations between humans that are conducted independently of the person who is considered to be the main indicator.
The primary source of ‘risk homeostasis theory’ is the writings of Petzman (1975) and Wilde (1976) (Borodzicz, 2005). Adams (1995 as cited in Borodzicz, 2005) explains that ‘risk homeostasis’ means a course of actions in which specific risks can be improved; however, the danger still persists owing to additional possibilities of incurring loss that are not focused on.
From an ‘anthropological’ view, cultural theorists profess that four general tendencies will influence a person’s understanding of and reaction to risk. These divisions are classified as: ‘hierarchical, individualist, egalitarian and fatalist’ (Borodzicz, 2005: 43).
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second, formulating vigilant plans; third, comprehension of ideas and overcoming difficulties; fourth, improving negotiating skills; fifth, inspiring the public to respond. In my view, it cannot be assumed that risk communication will mitigate all potential conflicts and that straightforward risk management will follow at all times. The risk communicator must be aware of the fact that those involved will not always accept the risk management proposals as suitable. Therefore, the success of the communication endeavour strongly relies upon the primary goals (Ng and Hamby, 1997).
Individualists tend to take a greater degree of risk when presented with the chance to profit from business ventures. Hierarchists would only react favourably to risk when it has been formally approved by the organization as a whole. Egalitarians look at risk as an ever-present source of danger created by human activities. Fatalists’ response to risk is based on the fact that there is a low possibility of dealing with it (Borodzicz, 2005). Thompson et al. (1990 as cited in Borodzicz, 2005) note that any transformations in the factors shaping group and grid relations can be simplified to the four classes outlined previously. In theory, the group and grid concepts are quantifiable. Obviously, determining both a group and grid variable is a very difficult task and this method also does not take account of the fact that people can alter their behaviour to suit specific situations. Cultural theory can then be completely comprehended if accepted as true or the other way round. Cultural theory as an abstract technique used for apprehension of risk perception covers a broad framework. Unfortunately, however, this method is rarely applied to give direction to risk management in reality (Borodzicz, 2005).
In conclusion, it is generally assumed that the most significant risk to any company is its survival. Hence, there is a need to comprehend fully the variety of risk approaches and develop risk communication among separate divisions of an organization. Humans have a tendency to perceive unfamiliar risks as frightening in comparison with well-known ones. Regardless of this finding, the familiar risks still account for the greatest number of human casualties. Voluntary risk seems to be desirable compared to obligatory risks. Individuals do not always have confidence or trust in the approved information from external sources. Systems theorists report that repeated incidents may go almost unnoticed as there are already strategies in place to deal with such familiar scenarios; it is the unknown incidents that may lead to disaster. If a systems paradigm is found, then provision and isomorphic understanding can enhance the safety of that system’s operation. Communication theorists, other specialists and the public evaluate risks in other ways. For instance, specialists work with numbers, while the public is interested in their legitimacy and verification. The risk communication approach has some advantages that contribute to data gathering, change development and offer direction in a crisis and a solution to a conflict. The main characteristic of risk communication is to maximise harmony and promote discussion between people with various beliefs and hopes. With respect to safety culture and cultural theory, these principles can be useful to modify the manner in which individuals are educated, think and control risks, although regrettably, risks cannot be completely eliminated (Borodzicz, 2005).
In the past, risk communication was mainly used for transmitting significant information from the specialists to the public. The contemporary public expects much more and requires greater inclusion (Ng and Hamby, 1997). For this reason, Bradbury (1994 as cited in Ng and Hamby, 1997) mentioned that risk communication has become an activity in which the public and risk communicators participate in mutual conversation. Evidently, those who communicate risk must improve their listening skills, recognize human issues and react to their ideas and feelings. Furthermore, they are required to be involved in advising, refining and applying communication efforts (Ng and Hamby, 1997). According to Covello et al. (1988 as cited in Ng and Hamby, 1997: 3), risk communication can be divided into four categories. Firstly, ‘information and education’ where individuals are generally instructed and taught about risks. Secondly, ‘behaviour change and protective action’ which contributes to lowering risk behavior by affecting the understanding of the public. Thirdly, ‘disaster warnings and emergency information’ which provides instructions to handle these events. Lastly, ‘joint problem solving and conflict resolution’, which engages the public to participate in risk management and find solutions to health, safety and environmental disputes.
Author : Vojtech Vohanka
As determined by Kasperson et al. (1992 as cited in Ng and Hamby, 1997), risk communication is comprised of five objectives: first, identifying and establishing reliance;
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References :
Borodzicz, E.P. (2005) Risk, Crisis and Security Management, Chichester: John Wiley & Sons Hopkin, P. (2012) Fundamentals of Risk Management: Understanding, Evaluating and Implementing Effective Risk Management (2nd Edition) [e-book], London: Kogan Page. Available through: University of Leicester Library, http://site.ebrary.com/lib/leicester (accessed 28th January 2013) Ng, K.L. and Hamby, D.M. (1997) Fundamentals for Establishing a Risk Communication Program, http://web.engr.oregonstate.edu/~hambydm/papers/ng.pdf, (accessed 28th January 2013). The Oxford English Dictionary (2013) Security, http://oxforddictionaries.com/definition/english/security, (accessed 28th January 2013).
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