Risk Management vs. Risk Prevention

Volume 138, No. 14 - Friday, September 27, 2013

In light of the recent tragic outbreaks in our industry, I wanted to discuss Risk Management vs. Risk Prevention.
But first, I want to send my great sympathies to all involved. I cannot imagine how horrible this must be for those involved.

These events are of great concern, and in truth there’s a lot of uncertainty. Fear is a rational reaction. The enemy is invisible. It would be natural to react to the uncertainty by hiding one’s head in the sand, or by grasping at the straw of zero tolerance, as the our overseers are prone to do.

Eliminate risk? Is that possible? Won’t there always be a risk? In truth, as we all sense in our gut, risk cannot be eliminated in biological systems. The only real way to prevent risk is to actively manage it.

Part of the work I do in Quality involves Risk Management. This is a hot topic these days, and applies to everything from the risks of currency fluctuations to the risks of a nuclear accident, something I don’t do, thank god, but a close associate did for years… now there’s a problem!

Risk Management by itself it can be effective, but it becomes much more so, when applied in a fully integrated program of Quality Management. Sadly, there are those for whom risk management programs’ only appeal is for its ability to shield from liability. They hide behind HACCP, and recall plans. They play the paper game.

HACCP, and other standards, in the auditing process itself, is a form of inspection after the fact, it is not the same as building quality and safety in. Environmental tests can only tell you when you have listeria, for instance, but by then it is too late. Listeria is a result, and a result has causes. You can only affect a result by managing its causes.

What are the conditions that lead to listeria colonizing in the first place? How can those conditions be managed through better process, so you never have the problem in the first place?

Those are the kinds of questions we should be asking, and they won’t turn up in most discussions on critical control points, because the focus is too limited; it doesn’t take into account all shareholders, human natures, the enviroment, the type of machines, the particular method, the tools and the pressure from the marketplace to produce at low cost. Like an airplane accident, there is no one cause, maybe not one critical control, there may be many, all of which have to happen in sequence for a disaster to happen.

There are lots of standards from ISO to SQF to the British Retailers that can be followed, have some merit, and can help you with liability. And in truth, these systems of outside verification of meeting standards by audit are a fact of life in other industries, and soon will be in ours. Nelson-Jameson can help with some of the paperwork requirements for SQF, for instance, what is becoming the industry leader.

But, you have issues that go deeper than protection from liability and meeting standards to the level of ethical, legal and long term business survival:
• How can you protect the lives and well being of consumers?
• And how can you protect assets, and those of your partners in the supply chain, should something happen, god forbid. (The law can be draconian, and one could argue it should when life is on the line.)

At the recent American Cheese Society conference, there was discussion about this, according to a well-placed source. It is striking how people will lash out at industry policing itself when they are the consumers, but are the first to suggest it, when they are the producers.

But, is expertise in the cheese business a guarantee of expertise in risk management? With lives on the line, can producers afford to depend on themselves alone?

So we get back to the essential question in the discipline of Risk Management: Can one identify and quantify the risks so one can make a reasonable cost/benefit analysis of the various horrid things that can happen, their real likelihood of happening, and the severity if they do?

Don’t hold it against me for stating the obvious, but Possible, Probable and Actual are not the same thing. Just because something CAN happen, or even that it DID happen, doesn’t mean it WILL happen. This is not a time to be shooting from the hip. And some things are so severe, even happening once is devastating, like a tsunami hitting Fukushima.

More and better data, and more information are needed than most producers have on hand if they want to make a measured, careful decision with a realistic possibility of making a difference, and they will need outside expertise to get to the root of what can and should be done.

For instance:
• Can you lump listeria with salmonella, or norovirus, or campylobacter, and handle their risks the same way?
• No, they are completely different biological systems and would need to be looked at in separate risk analyses.
• HACCP and other standards alone are no guarantee. The most recent unfortunate events happened not only to a small farm operation but a highly qualified company who had a great HACCP plan in place, and did a good job following it.
• If even the best plan can fail, and problems happen, and if testing every cheese or every batch is too late and too expensive, what do you do?

There are legal, pragmatic, and technical issues involved here, and my heartfelt advice is to seek qualified outside expertise. Don’t Google it, don’t Wikipedia it; don’t try to figure it out on your own.

The discipline of Quality Management, includes Risk Management as well as Process Improvement. It is not an easy discipline to master, and you would be kidding yourselves if you thought you could understand it without working at it full time, just like making great cheese.

Effective, legitimate professional guidance is costly. This work is very much in demand right now, as you can imagine, and getting the wrong people, and there are a lot of them out there, will be even more costly.

A solution I use for solving sticky problems like this is to facilitate the forming of small teams who pool resources, working together, coached by a Quality professional, starting with a complete risk assessment. This not only lowers upfront investment, I have found it to be more effective.

Using internet meeting software, so as not to disrupt peoples’ busy days, and solve the problem of distance, along with meeting in person and the telephone create the ability for team members to keep in constant contact, and the coach to able to provide focused timely guidance.

If you will forgive what may appear to be self promotion, but is really deep concern, if anyone wants to explore an idea like this further get in touch. I can bring to bear some of the best in the business, including me.

Dan Strongin runs a training and consulting company focused on delivering affordable online solutions to everyday business problems, including his udemy course: Understand Your Business, Earn More Money. Dan can be reached via email at dan@danstrongin.com or by phone at (408) 512-1086, or you can visit and blog or get discounts on his courses on his site: http://www.managenaturally.com.

Dan Strongin encourages your comments regarding this column. Comments can be made anonymously to columnists@cheesereporter.com.

 

Other Strongin Articles written for Cheese Reporter

dot Jack Booted Cheese Thugs

dot Towards a Safer Food Supply
dot Lies, Damned Lies and Dairy Safety: How Poorly Applied Statistics Could Lead to the Worse Public Policy
dot Is Dairy Safe Is The Wrong Question, Part 1


dot Not All Data Is Information
dot Start From Where You Are
dot Learning About Your Customer
dot The Vision Thing
dot Customer Service? NOT!
dot Collaboration: The Road To A Better Future
dot Resolution
dot Water

dot In Memoriam: Ignazio Vella 1928-2011
dot Of Cheese, Seals, And Deming
dot In Their Own Words: Lettie Kilmoyer
dot In Their Own Words: Fritz Maytag
dot In Their Own Words: Paula Lambert
dot Show Me the Money: Cost Accounting
dot Cost Accounting Chokes, Part 2: Inventory

dot Cost Accounting Is Choking Your Business, Part 1
dot It Ain’t Over ‘til It’s Over
dot Raw Reason
dot A Story For The Holiday Season, Part II
dot A Story For The Holiday Season
dot Truth In Labeling
dot This Too Shall Pass or "What were we thinking?"
dot Marketing Language That Resonates
dot When Will We Ever Learn?
dot Cheese Competitions In The Context Of Marketing

dot Economy
dot Even The Best Laid Plans Go Astray
dot Root Causes: Communication
dot Partners
dot Diamond Cutting:
dot
It's What You Don't Know That Can Hurt You
dot Integrity and Ethics
dot Pricing:  The Perceived Value
Designing the Effective Sell Sheet
Common Sense
It All Begins in The Mouth
Of Cars...

The Gathering Storm
As Our Industry Evolves, So Should Our Terminology:

Other Cheese Reporter Guest Columnists
Visit John Umhoefer
Visit Neville McNaughton

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