The Impracticality of Defining on What is “Practical” in Risk Reduction Due to Organizational Contexts

Risk management is a cornerstone of organizational safety and operational continuity, encompassing everything from accident prevention to crisis response. Yet, defining what is "practical" in terms of risk reduction measures often becomes a conundrum, especially given the diversity in organizational structures, resources, cultures, and regulatory environments. This essay explores the impracticality and issues of establishing a one-size-fits-all notion of practicality in risk management, highlighting how organizational differences fundamentally influence the adoption and effectiveness of safety precautions.

At its core, "practicality" in risk management refers to the feasibility and sensibility of implementing specific measures to reduce risks associated with accidents and incidents. Ideally, practical measures are those that provide the highest level of safety without imposing unreasonable costs or operational disruptions. However, the interpretation of what is practical varies widely across different organizational contexts due to variations in scale, risk exposure, financial capabilities, and cultural attitudes towards safety.

One of the most significant factors affecting practicality in risk reduction is financial resources. For large corporations, investing in innovative safety technology or comprehensive training programs may be entirely feasible, whereas for small and medium-sized enterprises (SMEs), such expenditures might be prohibitively expensive. For instance, while it might be practical for a multinational manufacturing company to install advanced real-time monitoring systems across its factories, a small local manufacturer may find periodic manual inspections more feasible. This disparity not only affects the level of risk each organization can practically manage but also the potential outcomes of risk-related incidents.

Regulatory environments also play a critical role in defining what is deemed practical in terms of risk management. In industries such as pharmaceuticals, aviation, or nuclear energy, where regulatory oversight is stringent, compliance with safety norms and protocols is non-negotiable, irrespective of whether organizations find these measures practically feasible. This often forces organizations to reallocate resources or alter operational practices significantly, potentially at the expense of efficiency or profitability. Conversely, in less regulated sectors, the definition of practicality might skew towards minimal compliance, leading to a wide variance in safety standards.

The culture within an organization significantly influences perceptions of what constitutes practical risk management. In companies where safety culture is strong, there is a collective commitment to upholding high safety standards, often transcending basic compliance or cost-benefit analyses. For these organizations, practicality includes any measure that enhances safety, regardless of its direct impact on financial performance. On the other hand, in organizations where safety culture is weak or secondary to production goals, only those interventions that do not impede operational efficiency may be considered practical.

The rapid pace of technological advancement presents another challenge in defining practicality. New safety technologies can offer significant improvements in risk management but adopting these technologies requires organizations to be adaptable and forward-thinking. However, the practicality of adopting new technologies can be contingent on an organization’s capacity to integrate and maintain these systems and the readiness of its workforce to adapt to new protocols.

Examining specific case studies can illuminate how differing definitions of practicality influence risk management strategies:

• In aviation, where the cost of failure is extremely high, it is practical to adhere to rigorous maintenance schedules and pilot training programs, supported by international regulatory standards.

• Tech startups might prioritize speed and innovation over stringent risk management practices, especially those that hinder rapid development and deployment cycles. For these companies, practical risk management might focus more on cybersecurity and data integrity rather than physical safety measures.

• Small construction firms often struggle with the practical aspects of implementing comprehensive safety programs due to cost constraints, unlike larger firms which might find it practical to invest heavily in safety due to the scale of their projects and workforce.

• Practical risk management in the technology sector focuses on cybersecurity measures, data encryption, and frequent software updates to protect against data breaches and hacking incidents, which are more pertinent threats than physical injuries.

• Risk reduction strategies in healthcare are centered around patient safety and data privacy. This includes stringent sanitation processes, the use of personal protective equipment (PPE), and adherence to HIPAA regulations for patient data.

• For financial institutions, practical risk management involves sophisticated cybersecurity measures to prevent fraud and data breaches, along with financial risk management strategies like liquidity reserves and diversification to handle market fluctuations.

• Schools and universities focus on ensuring student safety and data privacy. Practical measures might include campus security personnel, bullying prevention programs, and digital safety measures for student data.

• Risk reduction in manufacturing often emphasizes both safety and efficiency. Practical strategies include regular maintenance of machinery, safety training for handling hazardous materials, and automation to reduce human error.

• For retail businesses, practical risk management might prioritize loss prevention strategies like security cameras and anti-theft systems, along with fire safety measures and emergency exits to protect both customers and staff.

• For maritime operations, practical risk management involves regular inspections of vessels, adherence to international maritime safety laws, and training for crew in handling rough weather conditions and emergency situations at sea.

• In agriculture, practical risk reduction strategies might focus on the safe handling and application of pesticides, use of weather forecasting for planting and harvesting, and ergonomic tools to prevent injury.

Each of these industries tailors its risk reduction strategies to the specific challenges it faces, making what is "practical" highly dependent on the context, illustrating the diversity in how safety and risk are managed across sectors. Defining what is practical in risk management is inherently complex and varies significantly across different organizational contexts. What is deemed feasible and sensible in one setting may be considered overly cautious or economically inviable in another. This variability underscores the need for a flexible, context-aware approach to risk management that considers financial capabilities, regulatory requirements, organizational culture, and available technologies. The challenge lies not in finding a universal standard of practicality but in adapting risk management practices to meet the unique needs and constraints of each organization.

James A. Junkin, MS, CSP, MSP, SMS, ASP, CSHO is the chief executive officer of Mariner-Gulf Consulting & Services, LLC and the chair of the Veriforce Strategic Advisory Board and the chair of Professional Safety journal’s editorial review board. He is Columbia Southern University’s 2022 Safety Professional of the Year (Runner Up), a 2023 recipient of the National Association of Environmental Management's (NAEM) 30 over 30 Award for excellence in the practice of occupational safety and health and sustainability, and the American Society of Safety Professionals (ASSP) 2024 Safety Professional of the Year for Training and Communications, and the recipient of the ASSP 2023-2024 Charles V. Culberson award. He is much sought after master trainer, keynote speaker, podcaster of The Risk Matrix, and author of numerous articles concerning occupational safety and health.