Along with job growth, there will be a significant increase in the economic footprint of the project management profession which is expected to grow by USD$6.61 trillion. This enormous anticipated growth, along with higher-than average salaries, will make the next seven years an opportune time for professionals and job-seekers to build project management skills.

The squeeze on talent has already started! PMI’s Pulse of the Profession shows that high-performing organizations don’t just emphasise strategy and improve efficiency. They cultivate talent resources to deliver successful projects and programs. With that talent, they can reduce risk, increase stability, improve growth and build a strong competitive advantage.

In contrast, poorly performing organisations that don’t see talent as part of the success equation – they believe the job market is a bottomless pit of skilled people that can be bought in as needed. This puts their projects and their organizations at risk! Whilst more and more successful organisations have adopted talent management as a core competency, many others fail to invest in skilled project management talent and talent development initiatives, and this shows in their performance.

The contrast is stark – high performing organisations are likely to find some $20 million at risk for every 1$billion invested in projects, whereas low performing organisations place $280 million at risk, over 10 time the amount.

The low-performing organizations – those which complete 60% or fewer projects on time, on budget and within scope – are significantly less likely to provide a defined career path for project managers, a process to develop project management competency, and / or training on project management tools and techniques. Poaching talent is a zero sum game that simply drives up costs for everyone.

As a result of this lack of investment, a talent gap exists in project management. A large number of skilled practitioners are reaching retirement age, organisations that train staff hold onto staff and the rest are going to find recruitment becoming increasingly difficult. Talent simply does not grow on trees – skills need developing and nurturing within the organisations that need them.

The reason this matters is that at a time when project success rates are declining and risks are increasing, organisational leadership needs to fill an anticipated 15.7 million new project management roles worldwide by 2020. If they don’t, $344.08 billion in GDP will be at risk – and that’s not even counting the $135 million that organizations already risk for every $1 billion spent on projects.

The ‘high performers’ achieve their results through a combination of good governance and good management. They see project, program and portfolio management as strategic capabilities needed to invest in their organisation’s future. They recognise process improvement and talent management are the two key elements that need investment to deliver outcomes. And they use well proven governance and management processes such as requiring active sponsors (79% of project have active sponsors in high performing organisations -v- 43% in low performing organisations).

Talent management needs investments in selection, training, mentoring and coaching; ideally from internal resources but when necessary using external help to kick-start the development of the internal capabilities. (see more on mentoring and training)

Are you and your team ready to make talent management a strategic priority? Download:
PMI’s Pulse of the Profession™ In-Depth Report: Talent Management,  and
PMI’s Project Management Skills Gap Report, and see how you can build your organization’s success – one project manager at a time. To help PMI have developed a sophisticated career framework, see: http://www.mosaicprojects.com.au/Training-PMI_Framework.html#CareerCentral

The inaugural PMI Australia 2013 conference is over. To create the event, the PMI Australian Chapters collaborated to develop a platform for professionals, academics and community representatives to share knowledge and experience. For a first time and a new committee it was a great start and we look forward to the 2014 event.

Our contribution was a presentation: Communication ≠ Engagement that included the world’s first ‘mass verbal tweet’! Certainly social media and web technologies have made broadcast communication in the 21st century easier then ever, but communication does not equal engagement and the ‘verbal tweet’ proved this!

Project success requires the key stakeholders, including senior executives and the sponsor to be actively engaged in support of the project objectives. And achieving engagement requires mutuality, a robust relationship built on empathy and trust, plus credibility and leadership to bring different stakeholder viewpoints into alignment to assist the work of the project.

Effective communication is the tool that facilitates the building of relationships and engagement but this type of communication is focused, personal and two-way. As a consequence, the project team need to invest significant time and effort in these key communication channels. The challenge is identifying the right stakeholders and the right messages to communicate ‘at this point in time’.

You can download the presentation from: http://www.mosaicprojects.com.au/Resources_Papers_170.html

And read our blog on credibility at: http://mosaicprojects.wordpress.com/2013/04/27/credibility/

When our paper was originally submitted last year, I was expecting to be doing the presentation. However, in the interim I was accepted as a member of the International Faculty of the EAN University in Bogota, Colombia, presenting a Masters’ level course – Managing Project Teams. So I’m enjoying a few weeks in South America and the second author, Patrick Weaver enjoyed the hospitality of Sydney and presented the paper for us.

Credibility is a combination of being seen to be trustworthy, convincing, and reliable. It is built in the minds of other people who are ‘watching you’ or need to rely on you, particularly your team members, managers and other key stakeholders. People judge for themselves whether to take you at your word or not.

The Building Blocks of Credibility:

The key building blocks are set out below:

Trust is the foundation – when someone trusts you, you can build respect through ethical and effective behaviour. Trust is simply the assumption that you will behave properly and do what you say you will do; most pet owners trust their pets to behave! You earn respect by demonstrating ethical and effective behaviours. But respect is not enough – you can respect gallant losers and enemies.

The step from respect to credibility requires demonstrated competence, underpinned by knowledge (for more on competence see WP1056 Competency). When someone believes you are credible, that will listen to your advice and act upon your suggestions.

However, the beliefs perceptions and assumptions have to be real in the mind of the ‘other person’!

If your operating framework is not aligned with the other person’s belief framework you cannot be credible to them – it’s all in the mind of the other person.

You may be the greatest IT project manager in the world, but if the way you dress and the jargon you speak does not fit with a particular senior executive’s beliefs about how competent mangers dress and speak, you will not be credible to that executive.

The way to break through the ‘belief barrier’ is to build empathy.

Empathy is the capacity to recognise the emotions that are being experienced by another – the ability to ‘stand in their shoes’. Within business this is more generally characterised by a combination of beliefs and desires, and grasping these beliefs and desires is essential to being able to develop empathy.
The ability to imagine oneself as another person is a sophisticated imaginative process. An empathic interaction, however, involves you communicating an accurate recognition of the significance of another person’s ongoing intentional actions, associated emotional states, and personal characteristics in a manner that the other person can appreciate. It’s not the message itself that matters so much as the way it is communicated.

Put all of this together and you can build you credibility one stakeholder at a time.

Maintaining Credibility:

There are a number of things you can do as a project manager to maintain your hard earned credibility, including:

• Do What You Say You Are Going to Do – Following through is easier said than done, and requires thoughtfulness to back up your words with actions…all the time. Your team is always watching how you behave. If you say you’re coming in early the next morning to knock out a tough part of the project plan, then make sure you show up early. Credibility starts with following through on your smallest commitments and migrates all the way up to your major promises.

  If you are not quite sure you can follow through; then don’t commit to it just yet. There’s nothing wrong with keeping your mouth shut and doing a bit more research before committing, and then following through on your promise.

• Don’t Talk Too Much – The more incessantly you talk, the less credibility you will have. Certainly, project managers need to talk, usually a lot. The key is to find the optimal point at which you become and stay credible by moderating how much you say and what you talk about. You can always add a bit more ‘talk’ if needed, it is impossible to unspeak something that is already said.

• Listen to Your Own Conversation – A very helpful practice is to listen to your own conversation and reflect on your dialogue with project team members. They’ll remember everything you say, so should you!

Some Simple Ways to Destroy Your Credibility

It takes years to build up a storehouse of credibility, and it is a great asset to have. Then, if and when you do make an honest mistake, that storehouse of credibility will bring you through the storm. However, there are certain things that will destroy your credibility within a matter of moments:

• By Accident – Certain things are out of your. You must rely on others to do what they say they are going to do. You can follow up, cajole, and persuade as much as possible, but ultimately it is the responsibility of the resource to get the job done.

  Your superiors will understand for a little while if you are unable to deliver on a project because of other people’s shortcomings. However, these little accidents will ultimately undermine your credibility if they continue to occur.

• By Covering Up – You will destroy your credibility if you deliberately conceal information, it is a breach of trust – the foundation of credibility.

• By Being Manipulative – Another way to instantly lose credibility is to be manipulative. One technique of manipulation is convincing someone else that it’s in their best interest they get something done, when the reality is it’s in your best interest. Once the deception is uncovered your credibility is gone.

Conclusion

Build a solid base of credibility and your project management career will flourish. Trust is the foundation (for more on trust see: WP 10030 The Value of Trust). From this base your actions and competency build credibility. It’s hard earned, invaluable for influencing managers and ‘advising upwards’ effectively to help your managers help you, and it is easily destroyed!

Now to move onto PMOZ – PM Global’s major spring conference. We have been working hard on a revamp to make the program more flexible, accessible and exciting and moved to a city centre venue.

PMOZ 2013 will be held at the Grand Hyatt , Collins St., Melbourne from the 17th to 16th September (see more: http://www.pmoz.com.au/).

And, the framework for the conference program has been completely updated:

Tuesday Outline

Wednesday Outline

Early risers can attend an extended morning session on one or both days, and on Tuesday there is an extended twilight session.

‘9-to-5ers’ attend the normal PMOZ conference and for the dedicated ‘Dawn to Duskers’ you have access to everything an maximise PDUs ……

Each day starts with a focused workshop available to Early Birds and ‘Dawn to Duskers’ and there’s a similar twilight workshop on Tuesday for the Twilighters and ‘Dawn to Duskers’. Each workshop topic will be backed up by focused papers on the same general topic in the rest of the ‘half day’. Some of the options being considers for these three focused streams include :

• Business requirements and the role of BAs
• Positive dispute management – use facilitated options to avoid a costly fight.
• Change management and value – the critical back end of project delivery
• Project management in ‘Not for Profit’ and volunteer organisations with a focus on disaster recovery.

Four potentially hot topics and only three half days, we still have decisions to make……

In addition, the three main focuses of PMOZ remain in the program as well:

• Projects in organisations, focused on project governance, innovation, portfolio and program management, leading to the delivery of benefits and value.
• Planning and controls, focused on the tools and techniques required for effective project and program management. If the topic is a tool, technique or process used in project, program or portfolio management this stream is place to be!!
• People and the profession, focused on the people side of project and program management, all of the hard to use soft skills.

As in previous years, a blend of academic and practitioner papers will be presented on a wide range of topics within each theme. The call for abstracts is being extended to allow time for potential presenters to adjust to this new structure – all papers and suggestions are welcome.

Attending this new, dynamic and exciting event is altogether different – first you need to decide which registration option is best for you and then nearer to the day, which of the streams to attend during your time at the conference, there has always been a choice of excellent presentations – it has now become more challenging! Perhaps we need a workshop on decision making? Alternatively you can use our White Paper on Decision Making to help you choose.

We look forward to seeing you in September.

One of the notable features around ES has been the amount of hostility towards the concept generated by traditional Earned Value advocates (for an overview of ES see: http://www.earnedschedule.com/).

Everyone who understands EV recognises traditional EV is a very useful cost predictor and also recognises that the traditional SPI and SV calculations lose relevance later in the life of a project and fail completely if the project overruns time (ie, in approximately 80% of projects SPI and SV are less then optimal). To resolve this problem, the traditionalists suggest ‘looking to the CPM schedule’ for answers and decry ES.

Unfortunately, whilst a reliable and accurate CPM schedule is a critical underpinning of any competent EV system, CPM itself is a ‘wildly optimistic process’, see: http://www.mosaicprojects.com.au/Resources_Papers_117.html

One step towards eliminating this destructive debate was achieved this month – at last there is definitive research that validates ES as a technique. A research thesis from the AFIT (US Air Force Institute of Technology) Masters student, Capt Kevin Crumrine compares EVM and Earned Schedule indicators on US DoD ACAT 1 programs (for non-military types – ‘big’ programs). The thesis documents a series of five descriptive statistical tests conducted on the Earned Value data for 64 Acquisition Category (ACAT) I MDAP’s. The research found that Earned Schedule was a more timely predictor of schedule overages than Earned Value Management.

Unfortunately the statistical data did not compare ES with the CPM predictions. The thesis notes ‘One shortcoming to this research is the inability to map the Earned Schedule data to the critical path, but we consider Earned Schedule to be a strong tool for schedule prediction at the summary/contract level.’ The stated reason was ‘Our example produced earned value data no deeper than the Work Breakdown Schedule (WBS) level 3 (ex: WBS Element 1.2.3). The Critical Path data is collected much deeper, as detailed as WBS level 7 (ex: WBS Element 1.2.3.4.5.6.7). This disconnect prevented us from conducting a detailed analysis’

My feeling is the detailed nature of Capt Crumrine’s analysis meant the researcher could not see the ‘wood for the trees’. The only date that really matters on most projects/programs is the completion date! The level the data is collected at does not matter; neither does the activity/work package that that actually drives the final completion. What matters is the end date!!! The fact ES is a better predictor then EV should be 100% accepted and proved by now, and if not this detailed thesis should remove any residual doubts.

What is not proved is does ES provide a more reliable end date than CPM? My assessment outlined in Why Critical Path Scheduling (CPM) is Wildly Optimistic is that ES should be more accurate. Given the mass of data collected by Capt Crumrine it would be a pity if this last step is not applied by a future researcher.

The key role of CPM is (or should be) making the best use of the currently available resources on a project – this is the antitheses of predicting outcomes based on current trends in the way ES does. All that’s needed is another Masters candidate!!

Capt Kevin Crumrine’s thesis, ‘A Comparison of Earned Value Management and Earned Schedule as Schedule Predictors on DoD ACAT I Programs’ is now in the CPM electronic library at http://www.evmlibrary.org/library/Crumrine%20Final%20Thesis.pdf. If you are into analysis it is well worth the read.

We personally think they are useful and commit a significant amount of volunteer time to developing standards through PMI and ISO; as are certifications to demonstrate a person has a good understanding of the relevant BoK (and we make money out of running our training courses).

However, we are fully aware that passing a knowledge based credential does not demonstrate competency (and that passing a competency based assessment does not demonstrate transferable knowledge – both are needed see: Developing Competency).

We are also aware that too many organisations place too much emphasis on ‘ticking boxes’ rather then taking time to assess people or optimise solutions. The easy tick in the box may avoid ownership of a problem but also tends to avoid the solution itself……

For these reasons we commend the Association for Project Management (APM – UK, publisher of the APM BoK) for publishing a short video, based on a talk given by our friend and colleague, Dr. Jon Whitty to the APM in Reading UK in Nov last year. I hope it starts you thinking.

See the video: http://www.apm.org.uk/news/courageous-conversation#.UXE_pLXfCSp

PMBOK® Guide Fifth Edition
Standard for Portfolio Management Third Edition
Standard for Program Management Third Edition

As a consequence, the global PM community now has a set of basic standards that will remain stable for the next four years through to the next cyclical update scheduled for late 2016. The tight integration between all three standards means minimal duplication of ideas and best practices.

Whilst each of the PMI Credentials tends to focus on one of these three standards, the key thing from an organisational perspective is they are integrated, and after this round of upgrades better integrated than ever!

The Portfolio Management standard focuses on the investment decisions needed to select the best projects and programs to start and maintain to achieve the organisations strategy within its resource constraints. Selecting the ‘right projects and programs to do’.

For guidance on ‘doing them right’, the Program Management standard focuses on the business outcome and integration aspects of program management and the PMBOK® Guide covers off the basic skills and capabilities needed to deliver the project outputs efficiently.

Each standard can be used in isolation; however, the real power lays in using all three as a framework for organisational improvement – Creating an effective Project Delivery Capability (download our PDC White Paper). The final missing link, PMI’s updated OPM3 standard will be released later this year.

This means that organisations interested in developing a best practice capability across the ‘enterprise’ aimed at achieving the maximum sustainable value from its investment in projects and programs now have an ideal opportunity to buy into current thinking via these standards and time to develop improved processes.

We have enjoyed working through the standards and writing this series of posts on the improvements (for previous posts click here) – but 4 months down the track we now consider these ‘new’ standards business as usual, have consigned the ‘old’ standards to history, and will make this our last post on the updates. Our very last PMP and CAPM course based on the ‘old’ standards will be run at the end of May (course details) and then we will be 100% aligned to the new and improved versions. We encourage everyone else to do the same.

This year Lisa is back in Australia at the PMI Australia Conference, Sydney Convention and Exhibition Centre: 1 – 3rd May 2013. Her Master Class on the 3rd May is a must attend for any PMO manager, Project Director or Project controls professional.

Lisa’s master class focuses on the approaches she has adopted and the lessons learned in setting up an internal project management surveillance function within Booz Allen Hamilton’s as well as her extensive experience assisting US Government agencies and other clients.

The term surveillance is derived from the French word ‘surveiller’ and has a military pedigree. It refers to keeping watch on a location or person. In the case of project management, the notion of surveillance begs the question, “What do you watch?” Observing a project manager first hand is unnecessarily overbearing and may not be warranted. What you can watch is a project manager’s outputs from baseline establishment through project execution, as well as the people, processes, and tools in place to ensure appropriate monitoring and control processes are effective.

During the workshop, Lisa will explore the ‘best practices’ that are essential for successfully establishing a helpful and supportive surveillance function, including the essential processes, procedures, and vital internal relationship-building will be explored. She has proved effective and helpful surveillance will improve project performance – you too can learn the secrets!

For more information see: http://www.pmi.org.au/masterclass/.

I’m certainly looking forward to catching up with Lisa in Sydney where I’m presenting our paper Communication ≠ Engagement on the 1st day.

I encourage you to take advantage of this unique opportunity to learn from a ‘master’ and look forward to seeing you in Sydney.

The first PTMC (Project Time Management Certificate) workshop to be held in Australia – based on feedback from the attendees, this will grow to become a very popular training.

A free networking evening looking at the future of ‘project controls’ in Australasia. During the meeting the final wind-up of the Australian Performance Management Association was completed.

The main symposium included three outstanding key note addresses supported by stream papers and an engaging panel session.

The two days of concentrated learning and discussion were finished with animated networking sessions. All together an intense and enjoyable two days for both project controls professionals, and the executive managers responsible for governing this area of an organisation’s business. Two of the key outcomes from the Symposium were:

• Gary Troop, the President of the newly independent College of Performance Management (CPM) and symposium key note speaker announced a limited time offer to anyone in Australia to join the for US$25.  The CPM was a part of PMI from 1999 to 2012 but has reverted to an independent status to better serve the needs of the Earned Value community.  The College has a major on-line library of EV publications and plans to develop its conferences and webinars on a global basis – there is even talk of establishing an Australian Chapter – to be part of the exciting new development visit www.mycpm.org/aus and become part of the worlds leading EV community.
  
• The project controls professionals present in Canberra expresses a strong desire to see a network established to link all of the various ‘controls focused’ components within professional associations such as AIPM and PMI, independent bodies such as CPM and Planning Planet and individual controls professionals to help raise the profile of project controls, amplify the message from any one component member, and through the network assist in career development and finding the ‘right person’ for work when needed.

To help with this initiative, PM Global are starting to plan the second Symposium to be held in Canberra at around the same time in 2014 and discussions are underway to frame a proposal for a ‘no cost’ network designed to meet the needs of the ‘controls community’.

There’s a lot to do to maximise the gains made this week – watch this space……

In the meantime, if EV and /or ES is your ‘thing’ the US$25 offer is limited and needs prompt attention!  And to understand the link between controls and project governance see: http://www.mosaicprojects.com.au/Resources_Papers_172.html

My view expressed in the discussion is that the managers and directors of organisations destined to fail in the next 5 to 10 years will continue to pretend the climate is not changing (the cause of the change is irrelevant). This phenomenon of refusing to accept what is gradually becoming the ‘blindingly obvious’ is not uncommon among boards – there are still people who don’t accept smoking causes disease because only 50% of long term smokers are killed by the habit and they know someone who has smoked for 40 years and is still healthy… And whilst acceptance of the lethal effects of asbestos fibres are now more widely acknowledged, the mounting evidence of the danger was ignored by boards, architects and engineers for decades preferring short-term expediency over long term risk management.

Anyone with a basic grasp of science knows it is impossible to ‘prove’ climate change in advance; predictions are always based in probability. The simple facts of science are:

Fact 1 – there is no proof of any theorem in physics – all the scientists can state is that based on observation and experiment they have not been able to disprove the concept to date. The transition from Newton’s ‘gravity’ to Einstein’s ‘relativity’ to the 98% certainty Higgs Boson has been discovered is a case in point. Climate science is no different.

Fact 2 – there is overwhelming evidence the climate is changing significantly – the immediate consequences are more severe weather events (hot and cold; eg, tornados in the Murray Valley) and sea level rises caused by the sea waters expanding as they get warmer.

Fact 3 – these changes will have inevitable consequences on every business and every organisation.

The precautionary principle suggests prudent organisations make reasonable allowances for these observed effects. Optimist may hope they are temporary and will go away in a year or two, but how many boards really what to bet their future on an optimistic hope?

WHY the climate is changing is largely irrelevant (although green house gasses seem to be a major contributor). The issue for boards is recognising the reality that exists now and dealing with the real problems this is causing today, starting with insurance cover/premiums closely followed by increasing the resilience and diversity of supply lines.

Alun Stevens suggested the science is quite settled. He posted: I grant you there is a lot of noise, but the science is settled and quite unequivocal. To put it succinctly:

1. Radiation absorption by CO2 warms the atmosphere. This has been known since the mid 1800s and is identical in process to microwaves warming meat. If your microwave works, CO2 warms the atmosphere. if CO2 does not warm the atmosphere we are all deluded about our microwaves.
2. Other gases including water vapour also warm the atmosphere in the same way, but more effectively.
3. The higher the concentration of these gases, the greater the absorption of radiation and the greater the warming.
4. The CO2 concentration is rising. Every monitoring station across the globe has shown a rise including those in Antarctica and Tasmania where there is no local production of CO2.
5. The increase in CO2 is due to human activity. I can never understand why this is disputed because it is quite easy to prove. The world has an extremely accurate estimate of the amount of CO2 produced each year because of very good records of production and consumption of fossil fuels. Some may have been missed, but this just means that the answer is a Lowest estimate. The amount of CO2 in the atmosphere is a bit more difficult to measure, but is still accurately known because of the spread of measuring stations and satellites. The increase in CO2 content of the atmosphere is less than the amount produced by humans. The rest of nature is therefore a net absorber of CO2 and ALL of the increase is due to humans.
6. Methane concentrations have also increased. Some from increased animal production – ie human induced. Some from land clearing and related activities – human induced. Some due to thawing of the deep frozen stores in places like Siberia. Physics interlude – ice can only melt if heat is added to it. If the methane stores are melting, their heat content is necessarily rising. The methane rise is either human produced or secondary to rising temperatures.
7. Water vapour content is rising. Another physics interlude – the capacity of gases to hold water vapour is dependent on their temperature. If the water vapour content has risen it is necessarily true that the temperature of the atmosphere has also risen. Water vapour rise is a secondary effect to rising atmospheric temperatures.
8. There is an energy imbalance between the energy received from the sun and the energy being radiated back into space. There is some argument about this, but only about the size of the imbalance not about its existence or that it is increasing.
9. The amount of energy coming in from the sun has not changed materially. There are solar maxima and minima, but the differences in energy output between them are not big and are much too small to account for the increase in the energy imbalance. The earth has also been on a very consistent orbit over the last 150+ years or so and the Milankovitch cycle effect has in fact been very slightly negative – ie reducing the amount of incoming energy. There has been no increase in earthbound events (e.g. volcanoes) that could explain the increased imbalance. The increase is due to retaining more heat which can only be due to the ‘greenhouse’ gases.
10. The energy content of the globe is increasing. Less than 2.5% of this in the atmosphere. Over 90% is in the oceans with the rest in the continents (warmer rocks) and melting ice. There has been a significant reduction in ice volume. The only scientific argument is whether it is a lot or a lot more or even still more. Sea levels have risen. Some is due to the melting of continental ice (melting sea ice doesn’t change sea levels) and the bulk from expansion due to rising sea temperatures.

He continued: Although I am now an actuary, I started out as a physicist and have been interested in climate science for 40 years. Back then the question was whether rising aerosols in the atmosphere would cause global cooling or rising CO2 would cause global warming. The world responded strongly to the rising aerosols – sulphur, ash etc – so that concern disappeared. It did not respond to CO2 and we are now where we are.

The science was actually settled 20 years ago. All that has happened in the last 20 years is to settle it more and more accurately and to falsify all competing hypotheses. (As Pat rightly points out, that is what scientists do – falsify claims. Those that remain unfalsified, no matter how unpalatable, are the best estimate of the truth available.)

The outworking of all this is that the science is clear that:

1. The earth is warming.
2. The warming is accelerating.
3. The warming and its acceleration is caused by CO2 and its increase.
4. Human activity is the source of the increasing CO2.

Having got that off my chest, we now get back to what are actually the real issues, namely what does this mean and what should we do? Here there is some room for debate and argument. What is the likely extent of the warming? How quickly will it happen? What will be the impacts on the climate and weather at different temperature levels? What will be the impact on sea levels? What impact will weather and temperature changes and sea level changes have on human and other life and their activities?

The answers to these questions go to answering the sorts of questions that directors need to be asking. What should we do? How quickly must we do it? How much should we spend? Can we afford to do nothing?

This gets down to one of my current areas of interest – risk management. Boards have a responsibility to manage risks. It is one of their primary functions. Climate risks, like all other risks require a proper approach:

1. What is the risk?
2. What will be the impact of the risk?
3. How likely is it to happen – in this case the question is more one of when rather than if?
4. Can we absorb the outcomes?
5. If not, how do we mitigate the risk, insure the risk or avoid the risk?
6. How do we implement our decisions?

This all requires proper forward estimations which brings me to my final question (at last). How will you make quality estimations and therefore decisions? Will you just rely on the gut feel experiential approach of, ‘don’t worry, my experience shows that nothing has happened in my lifetime or that of my father and grandfather; things are always up and down; so nothing will change’? Or will you take into account the best scientific knowledge and properly model the potential outcomes?

To answer one of my questions – we cannot afford to do nothing. We have to manage the risk.

Alun concluded: I am a great believer that change is ALWAYS an opportunity to be exploited. This is a big change and it will be worth a very serious amount of money. There are opportunities in changing what we do now to prevent or reduce the impact of climate change. And, because of the tardiness out there, there are opportunities in doing new things to cope with and exploit the changes that will happen.

Interestingly this is not a global left/right political argument. Whilst the approach adopted by Tony Abbot in his announcements this week (Australian Liberal) and the US Republican party favour the easy option – shoot the messenger, treat each occurrence of an unusual weather event as a 1 off anomaly and pretend nothing serious is happening this is not a consistent ‘right wing’ position.

The UK Conservative party has a 100% commitment to reducing greenhouse gasses enshrined in law – the Prime Minister who set this objective in motion was Margaret Thatcher, hardly a ‘left leaning green’, but she was a trained scientist.

Conversely, many labour organisations oppose change to mitigate greenhouse gas omissions because of their short-term effect on their member’s employment. And the thing I find strangest is the farming community (at least in Australia) that has to adapt fastest and will suffer the most from extreme weather events, seems to be represented by bodies that want to deny the existence of a problem.

Somewhere there is a serious communication breakdown. Our innate biases tend to mitigate against dealing with the issue; some of the more potent include:

A reluctance to do things now for an uncertain future benefit,

A preference for what we know though direct experience compared to things we cannot see or touch, and

A tendency to ignore things we don’t like or that don’t fit comfortably with our current views (see more on ‘bias’).

Education in the broadest sense is the antidote to bias and this requires meaningful communication – something that has been seriously lacking.