From Risk Management to Risk Leadership

From Risk Management to Risk Leadership

Almost daily we hear of new cyber security lapses, which are increasingly dangerous in our digital age and may affect all aspects of our operations from finances to employee records.  For this reason, it is imperative “to embrace risk leadership rather than just risk management,” said David O. Renz, in an article in Nonprofit Quarterly. Renz is the director of the Midwest Center for Nonprofit Leadership at the Department of Public Affairs in the Henry W. Bloch School of Management at the University of Missouri-Kansas City.

At an Institute of Risk Management (IRM) seminar this past June, various experts met to discuss just how “the role of the Chief Information Security Officer is evolving.” According to IRM, “risk management involves understanding, analyzing, and addressing risk to make sure organizations achieve their objectives.  It must be proportionate to the complexity and type of organization involved.”  They also point out that “risk is inherent in everything we do,” so the type of roles undertaken by risk professionals are incredibly diverse. They include insurance, business continuity, health and safety, corporate governance, engineering, planning and financial services.”  In other words, all aspects of our operations.

At The Fedcap Group we schedule regular, in-depth discussions about risk working to fully understand the nature and make up of our organizations’ risk profile.  Every discussion is intended to raise awareness and sensitivity to the potential risks in all areas of operations.  We have even devoted an entire module or our Leadership Academy to the concept of Risk Management with board members serving as guest faculty.

Our staff is the first line of defense, so risk awareness training means that with their daily dilligence, they are helping to protect the entire operation.  Our mantra has become “If you see something, do something or say something!”  Just as every person within the organization is a leader—every person plays a pivotal role in understanding and managing risk. 

MITRE CORP has developed a detailed risk management plan of “21 Musts” including a management culture that must encourage and reward identifying risk by staff at all levels of program contribution that I found very helpful.  (See link below).  In it the authors stress, and I agree, that risk considerations must be a central focus of program reviews, risk management must never be outsourced, and technology maturity and its future readiness must be understood.

As pointed out by David Renz, “delay or failure in responding to risk, positions an organization for an even riskier course.”

mitre.org/publications/systems-engineering-guide/acquisiton-systems-engineering/risk-management/risk-management-approach-and-plan

Innovation is a By-Product of Organizational Structure

Innovation is a By-Product of Organizational Structure

Innovation is no longer relegated to high-tech firms and leading-edge entrepreneurs. Innovation is a critical and foundational aspect of the culture of a relevant non-profit.  If we intend to create long-term impact, innovation must be at the forefront of our work.

For many, innovation seems like a shiny beacon of brilliance that is only within reach of the brightest entrepreneurs. But this is not true. Innovation is a mindset. And, innovation can be scaled to be incorporated into the everyday life of every one of our staff and those we serve. Good ideas come from everywhere.

Research tells us that most leaders of nonprofits believe that to advance their missions, they must imagine and create new approaches to solving vexing social challenges.  In a recent survey conducted by the Bridgespan group 80% of nonprofit executives say that they know they must innovate or perish—and yet only 40% say they are organized to do so.

Sanford’s Social Innovation Review identifies six elements common to nonprofits with a high capacity to innovate:

      • Catalytic leadership that empowers staff to solve problems that matter;
      • A curious culture, where staff look beyond their day-to-day obligations, question assumptions, and constructively challenge each other’s thinking as well as the status quo;
      • Diverse teams with different backgrounds, experiences, attitudes, and capabilities—the feedstock for growing an organization’s capacity to generate breakthrough ideas;
      • Porous boundaries that let information and insights flow into the organization from outside voices (including beneficiaries) and across the organization itself;
      • Idea pathways that provide structure and processes for identifying, testing, and transforming promising concepts into needle-moving solutions; and
      • The ready resources—funding, time, training, and tools—vital to supporting innovation work

I think that these elements are right on, and I have sought to develop them within our organization. 

At the Fedcap Group we talk about the Operationalizing the Cube—a structural concept that engages our practice leaders, our company leaders, our corporate services and our regional leaders in business development including proposal writing, developing pitches, foundation outreach, etc.  Operationalizing the Cube is anchored in our Salesforce technology.   When these diverse teams of people come together—it is quite remarkable what can happen.

I also love the concept of Idea Pathways.  We developed something we call the Innovation Garage– as a structure to identify, test and transform good ideas into the kinds of solutions that make a lasting impact. 

Porous Boundaries also makes tremendous sense to me.  Early on in my tenure at the Fedcap Group, a board member suggested the idea of a convening that engages business, academia, government and the non profit sector to address issues of our time.  These convenings—now called Solution Series – are held twice annually and bring our leaders and staff together with a group of thought leaders.  We all walk away from these conversations enlightened and inspired. In fact our next Solution Series on October 16th is devoted to the topic Organizational Structure:  A Tool to Advance Innovation and Business Bottom Line.  I hope you can join us!

It is not easy to create an organizational structure that invites innovation—but at The Fedcap Group we have learned that the effort pays tremendous dividends.

How does your structure support innovation?  I would love to hear from you.

The Imperative of Human Resource Business Partners Who Understand Soft Skills

The Imperative of Human Resource Business Partners Who Understand Soft Skills

During most of the 20th century employees were hired by the Personnel Department, where they were screened, had their skills tested and their paper work processed. That department has since evolved to Human Resources and when they screen for skills, they are more often including “soft skills”—critical thinking, creativity, communication, conflict resolution, empathy, ability to problem solve and emotional intelligence–capabilities needed to contribute to the organization’s overall corporate culture and goals.  In fact, research from Harvard University shows that 85% of job success comes from soft skills and only 15% from technical skills. 

In what he terms the Human Resources Reset in an article at  www.forbes.com, Edward E. Lawler III, a distinguished professor of business at the University of Southern California Marshall School of business, writes “There is a great need for the emergence of talented HR professionals who understand complex business strategy and are able to use data about people to impact and advance organizational effectiveness.”    At a time when there is such stiff competition for talent, business leaders do not want to make a mistake in hiring.  It costs too much and takes too much time to undo the impact of a bad hire.  As such, companies worldwide are increasingly looking through the lens of soft skills when hiring or promoting for key positions. For instance, Johnson and Johnson found that in divisions around the world, those identified at mid-career as having high leadership potential were far stronger in soft skill competencies than were their less-promising peers.

This makes sense to me.  Every day I see how “soft skills” increase overall performance.  I see how individuals with high Emotional Intelligence form stronger, more productive teams, how individuals who can think critically and who are creative, are more successful in business development, and how individuals who can problem solve and resolve conflict are highly effective at managing risk. I also see the generative nature of teams of individuals with high levels of emotional intelligence.

But how do we get there?  At The Fedcap Group we are rethinking the role of HR and incrementally building a human resource department that strategically develops and refines its plans for recruitment, training, and compensation based on the long-term business goals of the organization.  We are working hard to build human resource management teams that function as integral business partners, helping each of our company leaders understand their talent needs and recruit and retain employees who possess the right combination of soft skills and technical skills.  We are looking for HR professionals who drive talent needs—not simply fill position requests.

This is not a small undertaking. 

We look for HR professionals who understand the relationship between talent and the accomplishment of organizational goals. We look for HR professionals who understand how to assess for soft skills and can teach others to do the same.  We look for HR professionals who understand the dynamics of the teams they are hiring for, who look for gaps and find talent to fill those gaps. 

Our Human Resource Department is increasingly central to our strategic planning and our short and long-term business success.  

6th Annual Fedcap Golf Tournament

6th Annual Fedcap Golf Tournament

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On Monday, August 12th The Fedcap Group held its annual Golf Tournament at Quaker Ridge Golf Club in Scarsdale, New York. Twenty-two golf foursomes played under beautiful summer skies at the highly regarded par-70 course designed by renowned golf course architect A. W. Tillinghast.

The event, attended by over 100 people, netted $60,000 to support young people who are transitioning from foster care and preparing for college and careers.  These extraordinary young men and women, at risk of homelessness and joblessness,  can now be provided with mentorship, high impact internships, and assistance in applying to and graduating from college.

Many thanks to our sponsors – Greenberg Traurig, Ken Raisler, IDB, Benefit Management Solutions Inc., People’s United Bank, Oracle, ABFS, American Paper and Supply, Sterling Sanitary Supply, SAS Maintenance, Platinum Maintenance, and Titanium Scaffold Services.  Thanks also to Quaker Ridge and all our friends and supporters who made this event possible. 

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Getting the Pace Right

Getting the Pace Right

Augustus, founder of the Roman Empire famously said Festina lente or “Make haste slowly.” Does this seem quaint today? Or does it still make sense in a 24/7 world moving at the speed of a smart phone? Several years ago, the author and business leader, James Sudakow wrote in a blog that he had participated in meetings “where key leaders are literally working on their laptops on something else during important decision-making processes—not because they are trying to be disrespectful but because there is always something else that is urgently pulling them away.”

As leaders, we all understand this pressure.

Management consultants, McKinsey & Company, in a 2018 blog on leadership by Cornelius Chang and Robin Groeneveld, point out that speeding up isn’t the answer. “Most leadership theories continue to be based on—and most leaders still live and work on—the Newtonian world view where leaders strive to control and structure their challenges and guarantee outcomes. Engaging in a quick discussion and moving as fast as possible from A to B in a controlled and straight line fits this world view perfectly.”

But does that model of rapidly moving from A to B hold in today’s complex environment?

Because we work on many goals and projects simultaneously moving quickly throughout the process, it is crucial that we realize the difference between arbitrary and urgent. Slowing down in a focused way may actually be the path toward achieving the right pace and thereby making the right decisions. The logic that Chang and Groenevld offer: “Accept that your challenges are complex, pace the speed of your work, trust that intelligent, in-depth discussions lead to solutions, and set the right attention and intention by being present and directing your energy.”

As we strive for sustainability, relevance and impact at The Fedcap Group, we see the need for, and the value of, leadership moving at the same pace. We are making critical decisions that depend us being in sync. As leaders we are asking ourselves: Did we take enough time to thoroughly review various scenarios before making a decision? Did we have the right people in the room? Did we allow for differing perspectives to have voice? Did we slow down enough? In a new book called Slow Down to Speed Up: Lead, Succeed and Thrive in a 24/7 World, published by Business Expert Press, business advisor and consultant Liz Bywater, Ph.D., reminds her readers that being mindful is learning how to be completely focused on present conversations and present realities.

It is crucial that we form a strategy to find a balance to our fast-paced work environment so we can lead with clarity, thoughtfulness, and purpose.

The nine to five world is long gone, a time when we turned off the desk lamp, pushed the chair back under desk, and closed the office door. We now live in a 24/7 world and may still be a bit shaky about how to make it work. Festina lente!

America Has a Health-Care Crisis — in Prisons

America Has a Health-Care Crisis — in Prisons

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Prison is no place to get sick. The nation’s incarcerated population is aging rapidly, with nearly four times as many inmates 55 or over as there were at the start of this century. That’s led to increased rates of diabetes and heart disease, among many other problems. Younger offenders are hardly the picture of health, given their high rates of addiction. Altogether, prisoners make up 1 percent of the population, yet they account for 35 percent of the nation’s total cases of hepatitis C. “They are the most expensive segment of the population,” says Marc Stern, a public health professor at the University of Washington, “and they are the sickest.”

For all the care that inmates need, they’re unlikely to receive adequate medical attention. Over the past dozen years or so, a majority of states have contracted out prison health care to private companies. The leading vendors have all been on the receiving end of hundreds of lawsuits. Some are frivolous, but some have led to multimillion-dollar judgments and court orders to change their practices. It’s a problem that could get worse.

Horror stories of needless deaths abound. From Arizona to Florida, prisoners with cancer have been treated with nothing more than Tylenol. A recent Columbia University study found that 97 percent of inmates with hepatitis C do not receive the expensive medication they need. Inmates routinely have to complain of the same symptoms multiple times before they even get to see a doctor, sometimes waiting weeks. There’s no doubt that prisoners have faked illnesses, and escape attempts during medical transfers to hospitals are a real problem. But too often the default attitude among guards and other staff is that inmates are lying about being sick, says Susan Lawrence, a physician and attorney who has worked in prisons.

Lawrence once had a patient in prison with liver cancer. Staff videotaped him working out in the yard to prove he was a fraud. He died a month after she was finally able to treat him. “The man had had rectal bleeding over a year. It was never taken seriously,” Lawrence says. “They didn’t understand how you can still function with metastasis. ‘How bad could it be? He’s working out. How can he have terminal cancer?’”

States often pay private companies on a per-inmate, per-day basis. That creates an incentive to cut costs. The market forces that discipline private providers on the outside, however, don’t apply in prison. There is no consumer choice. An inmate who doesn’t think medical treatment is up to par can’t switch to another prison, let alone a different hospital. And if the state, not the prisoner, is the customer, state officials don’t always know what they’re getting. Record-keeping is notoriously poor, and in some states, the department of corrections doesn’t even receive annual reports from its vendors.

When prison health care was first privatized in a major way, there was little reliable actuarial data, so it wasn’t clear what a reasonable price structure would look like. Over time, governments figured that information out and started writing better contracts, but that led to shrinking profit margins for vendors.

There have been other stresses on the business model. What was a growth area a decade ago is now stagnant. The state systems and large jails that are likely to privatize have already done so. With few new contracts out for bidding, providers low-ball one another in order to get business. That leaves yet less money available for care.

There’s been considerable consolidation within the prison health-care field. At this point, there are three major players — Corizon Health, Centurion Managed Care and Wexford Health Sources. States unhappy with their services don’t have many other places to turn. In December, Maryland gave its business to Corizon, having grown dissatisfied with Wexford. A few months later, Corizon was replaced by Centurion in Arizona. That state, which is embroiled in legal battles with a federal court about monitoring and performance measures in prison health, has now used all three companies. “It’s like a game of musical chairs, but there are only three chairs,” says David Fathi, director of the ACLU National Prison Project. “States tend to switch but they can pretty quickly run through all three.”

A change in contractors doesn’t necessarily lead to a change in care. Medical personnel often keep their jobs, particularly at remote rural facilities. The vendors co-opt each other’s staff and cannibalize each other’s business. None of that is good for care. It’s not clear, however, how many prison systems would be able to build their own medical teams back up, even if they wanted to. Having states provide health care themselves is no panacea anyway. Prison health care in California has been under receivership since 2006, when a federal court found that the state’s delivery of medical care did not meet constitutional standards. That’s why Stern, the public health professor, says, “if we focus on [the faults of] privatization, we’re not going to solve the problem.”

Some argue that prison health would improve if it were treated as part of the local community health safety net system. Communities are not immune to what happens inside their prisons, whether it’s opioid addiction or infectious disease. But most taxpayers on the outside don’t see prison health problems affecting their own well-being. The reality may be that treatment for those people society wants to punish will never become a top priority.

Originally Published by Alan Greenblatt in the August 2019 edition of Governing.

The Right Talent as a Catalyst for Innovation and Impact

The Right Talent as a Catalyst for Innovation and Impact

Over the last few weeks, I’ve written about the strategic risks leaders must address to thrive in a competitive environment. Recently, I’ve discussed the importance of creating and sustaining a positive culture that helps drive innovation and change.

Critical to creating and sustaining the right culture is the sourcing, finding, and cultivating the right talent is another key catalyst for driving innovation and impact.  

Our people are our most strategic resource.  We have just implemented a new Human Capital Management system, as employing state-of-the-art technology around talent acquisition and management is critical to recruiting and retaining top notch staff.

The ability to recruit top talent stems from being known as a premier employer and building relationships with feeder institutions such as business, universities and local chambers.  And with that we have developed a description of the DNA of those who are successful in The Fedcap Group.

      • Passionate: They are driven to create/identify and resource the most effective ways to solve problems for people with barriers.
      • Informed: They are current within their respective fields.
      • Credible: When they speak, people listen because of their depth of knowledge and expertise.
      • Smart and Fast: They can see the end result and take quick, thoughtful and decisive action.
      • Creative: They generate innovative and often unexpected answers to difficult problems.
      • Curious: They thrive on new information and opportunities.
      • Dedicated: They run a continuous campaign to advance the position of The Fedcap Group and the people we serve.
      • Understands the concept of “Good to Great”: They constantly look for opportunities to improve the work of The Fedcap Group, searching for best-in-class practices–not reinventing the wheel.
      • Flexible: They are able and willing to do whatever it takes to get the job done.
      • Fun: They take their work seriously, but not themselves.

Once recruited, the interview process demands its own structure and expertise.  When hiring for top positions in the agency, I ensure they spend time with every key leader.  I invite them to one of our “Corp Weeks” – where key staff from throughout the company come to New York to discuss corporate health, emerging trends in our areas of practice, review data about our company’s performance and brainstorm potential areas of innovation.

When I assess talent, these are the things I look for in prospective candidates:

      • How does the candidate think? What is important to them?
      • How does the candidate keep current on trends in their area of focus?
      • What do they see as trends over the next 5-10 years?
      • How do they use information to advance new ideas?
      • How have they made a difference?
      • How have they built effective structure in the past? How do they know they were effective?
      • Is the candidate one who consistently considers “what if?” scenarios?
      • How comfortable is the candidate with ambiguity? And if comfortable, how do they bring clarity and structure to that ambiguity?

The vision, the talent, and the ability of the staff to execute all combine to create the catalyst for driving—and realizing—innovation and ultimately impact in the lives of those we serve—creating a legacy for current and future generations to come.

The Long Term: Sustaining a High-performing, Positive Culture

The Long Term: Sustaining a High-performing, Positive Culture

Last week, I wrote about the importance of creating a culture by focusing on the things we value most and being deliberate about translating that focus into behaviors that reinforce our key tenets. This week, I examine the keys to sustaining a positive, high-performing culture.

Culture can sometimes be described as a “soft” aspect in an organization. But in fact, culture is driven by “hard” organizational components—including infrastructure, data, reporting and analysis, talent acquisition and management, risk management, financial stewardship, and day-to-day communications.  Each of these components must be aligned with the values and vision of an organization in order for the culture to stay consistent.  

As I wrote last week, accompanying these “hard” aspects of culture are the vision and the ensuing expected day-to-day behaviors that sustain positivity.  Sustaining a positive culture is, in itself, a body of work that requires reinforcing the vision, breaking the vision into expected behaviors, clearly articulating what those behaviors look like, acknowledging and encouraging the named behaviors, and calling out those that do not reflect the named culture. It means naming the values as a part of our job descriptions, performance reviews, and articulating them in ongoing one-on-one and team meetings.  

Also essential is an ongoing and consistent process for measuring adherence to the values that comprise our culture.   Every one of us is responsible for upholding the vision and the behaviors that accompany that vision.   We are all “owners” of the business—in other words, we are stewards of our vision, our values, our behaviors, and the structures that embody our culture.

Who we are internally reflects who we are externally to every stakeholder—from vendors to corporate and contract partners to every constituency we serve.  Our culture and the accompanying structural and behavioral building blocks are the keys to organizational success, credibility, and our ability to manifest the Power of Possible in concrete and measurable ways—leading to better lives for those we serve.

I welcome your thoughts. 

Shifting Culture as a Strategic Imperative

Shifting Culture as a Strategic Imperative

The building of a culture requires a thirst for knowledge about what is….”   J. Bennett

Last week, I wrote about the imperative of establishing an organizational culture that embraces change as an essential key to managing strategic risk and accomplishing organizational goals. Over the next few weeks, I will be examining the mechanisms for identifying and analyzing organizational culture and ways to systematically shift the culture as required.

Shifting culture is not necessarily easy—but it is possible—and it can be done with the right process that is emphasized and supported over time. That process includes: 1) clearly identifying and acknowledging the prevailing culture; 2) setting a vision for culture and establishing accountability mechanisms to advance expected behaviors; and 3) ensuring that our employees are acknowledged and supported as they begin to make the necessary behavioral and attitudinal shifts.

Acknowledging the prevailing culture: As leaders, we must be aware of the prevailing culture. This means that we understand what is happening two, three, four layers down in the organization.  Some leaders may make the mistake of assuming that the way people treat them, respond to them or interact with them is the norm across the agency.  Often it is not.  

I do this in several ways. 

First, we talk about culture and its inextricable link to organizational success.  I make it a point of talking with our senior leaders and staff how an innovative, responsive and data-driven culture is a foundation for successfully carrying out our long-term strategy.  That successful and high-performing organizations have a culture that is purpose-driven, performance-focused, and principle-led. 

Then I ask—how do we compare?  I make no assumptions but instead invite feedback and honest assessment from employees by asking very specific questions that speak to culture—sometimes in quick and informal settings and sometimes in more formal gatherings.

I call for honesty around what might be identified as subterranean cultural issues that might interfere with the organization achieving its goals.  For example, I ask…do people respond in a timely manner to one another?  Does the field feel supported by corporate services?  Do they get the information they need, as rapidly as they need it to do their work, manage their budgets, hire good people? I work hard to create a safe place for people to speak directly to the issues of culture and engagement. With every conversation, I listen carefully. This listening establishes trust, which in turn, engenders direct and honest feedback. I want to hear it all. Sometimes I hear things that are difficult or in direct contrast to the kind of culture that is required for success. I invite the truth, and I am not afraid to hear it.  I encourage senior leaders of the organization to be equally as inquisitive, as interested in the day-to-day experiences of their staff.  And I want to know what they learn. 

This learning provides us with the opportunity to act.   We have a sense of where there are gaps—in communication, trust, accountability, and delivery of expected results—and we can respond. 

As we continue to explore culture next week, I will speak to the setting a vision and establishing accountability mechanisms to advance expected behaviors at the leadership and line staff level.