Risk in work unit business planning: Capturing outcome pictures at each level

In this article:
The picture of Success What could be better than Success? The organisation’s worst nightmare may be about you: Worst imaginable outcomes Intermediate outcomes Realism

Previous article: Risk in work unit business planning: Degrees of success and failure


In an earlier stage you produced a list of unit objectives.

These pictures will be used to classify the impact or consequence of individual risks. In ISO 31000 vocabulary, the pictures are the ‘consequence criteria’.

The overall likelihood of each outcome picture will also be the direct basis for confidence in your business plan. Where there isn’t enough confidence, the gaps will be the basis for the issues to be discussed calmly with the boss.

This stage in the risk management is both rewarding and challenging.

For this stage you will use a format that has a cell for each of the seven levels of success.

Unit Objective: (Put your objective here)
Success/Failure level Outcome pictures
Far better than expected
Excellence
Success
Qualified Success
Partial Success
Failure
Worst imaginable

You will need one of these for each objective.

It is also possible to use a matrix format, showing all the objectives in one direction, and the seven levels of success in the other. In the real world, I normally use a matrix with the objectives running down and the seven levels running across (example in A3 PDF). A large matrix is hard to squeeze into a browser window, so all the illustrations here have a separate vertical table for each objective. If you are building a template, I’ll just mention now that it is sometimes helpful to split the objectives into sub-objectives (up to 5), so your matrix should be expandable in that way (example in A3 PDF). In the vertical format used on web pages, the sub-objectives are columns within the Outcome Pictures column.

The picture of Success

Starting with your first objective, describe a picture of what ‘success’ looks like in a short but clear and persuasive paragraph.

Visualise success as the success outcome looking back from the end of the planning period.

This description will probably relate closely with your wording of the objective itself. The important thing for the Success outcome is that it is a place, not a direction. So these are the questions you need to consider:

To what extent will the objective have been achieved?

What is the (least exciting) situation will you have to be able to report to claim ‘Success’ on that objective? There may be a few statements linked together with ‘AND’.

For brainstorming, think of completing the following sentence in as many ways as possible:

The year-end unit outcome must at least include …

The concept of ‘at least’ is critical. Don’t be aspirational, instead focus on the closest line that you will need to get over.

Write the description of that success picture in the past tense. You don’t need to include the introductory words. Put that description into the ‘success’ cell.

Unit Objective: Maximise the timeliness and accuracy employee payments employees in line with proper management decisions and legal entitlements Brainstorming seed (complete the sentence)
Success/Failure level Outcome pictures
Far better than expected
Excellence
Success There have been no missed paydays due to payroll team failures. There may have been some isolated bank problems that delayed employee access to pay deposits (not due to the payroll team). The year-end unit outcome must at least include …
Qualified Success
Partial Success
Failure
Worst imaginable

It is good to have multiple pictures of success. They all go into the same cell.

When you’re happy with that description, move on to define Success for each of the other objectives.

What could be better than Success?

Pick one of your objectives. Consider the best conceivable outcome on that objective – regardless of realism – and write a descriptive paragraph in the ‘Far better than expected’ cell. As for success, describe how things would appear looking backward from the end of the year. Write the achievements as though they were now behind you.

For brainstorming, think of completing the following sentence in as many ways as possible:

Over the year, the unit achieved a lasting improvement to the organisation’s success by ….

Unit Objective: Minimise total payroll service costs per paid employee (including ICT costs) Brainstorming seed (complete the sentence)
Success/Failure level Outcome pictures
Far better than expected Sustained payroll service performance is publicly identified as a model or benchmark for ‘best practice’, adding to the prestige of the organisation. Over the year, the unit achieved a lasting improvement to the organisation’s success by ….
Excellence
Success Total recurring real payroll service costs per paid employee did not increase over the year.

Payroll service costs are within industry norms.

The year-end unit outcome must at least include …
Qualified Success
Partial Success
Failure
Worst imaginable

Focus particularly on the outcomes that result from external sources and good luck, as well as those at which the unit is working hard.

For some objectives, you might find it difficult to imagine an outcome ‘Far better than success’. If you can think of an outcome that is better than the defined level of Success, but not Far better, you can put that picture into the ‘Excellence’ cell. Or perhaps, for the current objective, going above the basic result is of no actual use to anyone. In that case, you can move on to another objective and try again.

It is good to have multiple outcome pictures in the ‘Far better than expected’ cell.

When you’ve had a go at defining what’s better than Success on each of the objectives, you can move ahead to the really satisfying part, at the other end of the success and failure scale.

The organisation’s worst nightmare may be about you: Worst imaginable outcomes

Again working through each of the objectives, write a descriptive paragraph for the ‘Worst imaginable outcome’, in the applicable cell.

For brainstorming, think of completing the following sentence in as many ways as possible:

The organisation regrets having set out on the path leading to what the unit did during the year, which included ….

Focus on the outcomes that would involve some very bad luck. This is risk management, and you need to consider the effects of uncontrollable and uncertain events, not just the predictable outcomes of unit performance.

Don’t hold back, make it genuinely horrific. Think about not just how bad it could be for your unit, but the harm your unit’s function could do to the organisation if it were run by an evil genius instead of someone like you. Then go beyond that, and consider ways in which your unit could harm the organisation’s customers, or the whole sector. Ideally, come up with a way in which your work unit could become the organisation’s worst nightmare.

The picture describing that nightmare can be intense and cathartic.

It’s good to talk about these things. If it does nothing else, it will make your actual results look relatively good.

Multiple nightmares are better than just one. If there are different kinds of outcome that would all count as organisational nightmares, put them all into the cell, linked together with ‘OR’.

As with the Success outcomes and those that are even better, describe the situation as seen looking back from the end of the year.

Unit Objective: Prevent fraud against the organisation by employees or by payroll unit members Brainstorming seed (complete the sentence)
Success/Failure level Outcome pictures
Far better than expected
Excellence
Success
Qualified Success
Partial Success
Failure
Worst imaginable During the year, multiple payroll team members have colluded to commit systematic fraud involving ghost employees.

Payroll unit has recruited real employees into taking inflated pay in exchange for kick-backs.

There was a large-scale misappropriation of disbursements that was achieved with very little effort, and might have been repeated.

The organisation regrets having set out on the path leading to what the unit did (or allowed to happen) during the year, which included …

Ideally these examples will illustrate the meaning of ‘don’t hold back’.

If you really can’t think of anything that bad, that’s fine, don’t make create anything unnatural to fill a space. Just move up to ‘Failure’ and put some pictures into that cell instead. Don’t expect that picture to scare anyone outside your unit (maybe your boss). You may find that there are some good ‘Worst imaginable’ outcomes for Danger objectives, even if they are hard to find for the Benefit or Capability objectives.

Intermediate outcomes

After describing the worst outcome pictures for each objective, continue to put descriptions into the remaining blank cells not yet populated. In each case the picture should match:

  • the particular objective (for the row), and
  • the meaning of the column heading (success/failure level) as it would be understood by you and your boss at the end of the year.

This reference table includes relevant brainstorming questions and filters for answers for each success and failure level.

Realism

Lastly, have a further look at the Success cells for each of the objectives. For each Success picture, ask if your expectation of that outcome for the coming year is realistic. Consider the implications of the most recent comparable outcomes, and of historical trends. You may feel that one of the other outcomes for that objective is more likely.

  • If it’s a less attractive outcome that is more realistic, you may want to start early on lowering any expectations you and the boss might have had. There is no point in calling the most likely outcome a ‘risk’. It’s not a risk, it’s a forecast. Gaps between organisation expectations and expert forecasts are not risks to the future outcome. They are management problems to be addressed immediately.
  • If it seems likely that you will do better than ‘success’, there’s no risk-based justification for raising the expectations. Just be prepared to defend your definition of ‘success’ to the boss.

If you have worked diligently through all the review questions, your collection of outcome pictures is now ready to use in risk analysis. You may continue to make incremental improvements.

It is possible to spend more time on the collection to make a smaller and more elegant version. Taking the extra time may be justified before lot of different people are going to see or use a one-page matrix of outcomes. The drill-down article is a comprehensive guide to proving and consolidating your outcome pictures. If it’s just for you, your boss, and some close team members, there is no need to detour to that level now. You can have another look in the next cycle of review and update.


Drill-down article:

Risk in work unit business planning: Prove and consolidate the outcome pictures

Picture review Cell review Objective-level review Review of the whole picture collection

Next article:

Risk in work unit business planning: Wrap-up on Objectives

Each outcome picture is important, even if unlikely Comparing the objectives with the business plan Where we are in the risk management process Reconciliation with a ‘standard consequence scale’

Previous article: Risk in work unit business planning: Degrees of success and failure

Index to the series

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