SYMPTOMS OF ADAPTABILITY STRUGGLES Two Beats Behind. Teams that do not adapt lag their more agile competitors—with predictable results. Frozen by Fear of Failure. Frightened by the specter of failure (or accepting responsibility for an adaptation that didn’t work), leaders and their organizations remain unchanged as failure overwhelms them.

Furthermore, the company’s CEO hired the best of the best: an accomplished CRO from Goldman Sachs. But the CRO was often asked to leave meetings with the firm’s executive committee when risk-related issues were under consideration. By 2007, Lehman’s leadership stopped inviting the CRO to executive committee meetings altogether. The CRO was rendered

The reality is that we all tend to maintain the status quo and “keep doing what we’re doing.” This is something we have to recognize and often work to overcome. In organizations inertia can be a reason for retaining positive habits, and it can also be a reason for continuing behaviors that were never consciously started.

Communication, the essential enabler of the Risk Immune System, doesn’t happen spontaneously. As we saw in Chapter 3, natural reluctance, even outright resistance, to sharing information must be overcome through demanding leadership and personal example. Leaders must also constantly monitor potential intentional and unintentional misinformation. At

Some scoffed at the “China virus” or the “Kung Flu,” while others geared down for the ordeal to come. Political rhetoric bumped heads with scientific prediction, as varying descriptions of the virus dictated reactions to the disease. A lack of a coherent narrative meant a lack of unified response.

From an organizational standpoint, narratives set norms and standards that do much to drive behaviors.

One of his favorite sayings was about assigning clear responsibility: “If three people are responsible for feeding the dog—the dog is going to starve.” If you’re not sure who’s responsible, it’s time to figure it out. If you’re a leader, and unless you can confirm others have the responsibility—you probably need to assume you do.

The art of war teaches us to rely not on the likelihood of the enemy’s not coming, but on our own readiness to receive him; not on the chance of his not attacking, but rather on the fact that we have made our position unassailable. —Sun Tzu, Chinese philosopher and military strategist To study risk is to reconsider what we think we know about being

Is leadership facilitating or inhibiting the Detect—Assess—Respond—Learn process? How does leadership help the Risk Control Factors function individually and in concert? From your leadership perspective, what factors need the most work to ensure your Risk Immune System is performing? Do members of your organization identify with and feel committed