The temperature in Texas is hot. Well, it’s freezing cold. Actually it’s the worst cold front we’ve had since the 1940s. So better stated, many Texans’s emotions are hot and ready to boil over. It’s not hard to wonder why. In my city, Austin, we’ve had up to 60% of our residents without power, pipes are bursting everywhere, and for those who still have running water we now have to boil water to drink it. To say that this is an unacceptable way to live is an understatement.
However, times like these offer learning experiences and chances to grow. Some people and organizations will take advantage of these learning opportunities. Some people won't.
Throughout social media and even inside some homes, Texans are arguing over why this happened and who's at fault (in between trying to get warm). The biggest argument is over whether or not Texas should have weatherized its power infrastructure to handle this type of weather. However, the other minor argument is between those who believe in the ideology of self reliance over trust in the state versus those who believe in reliance on the state over trusting in self reliance.
This isn’t going to argue either point of view.
The undeniable reality is that Texas never thought and never built for weather like this. In fact most Texans are also at fault. From our homes to our clothes to the fact that Texans seem fine buying RWD trucks and SUVs we didn’t prepare ourselves for this weather.
Disasters happen. The improbable is always in hindsight the foreseeable. And because it was “foreseeable” we now blame the government for neither preventing nor saving us immediately.
It comes down to basic risk calculations that everyone of us make on a daily basis. There's a reason why you shouldn't live within the 100 year flood plain, yet people regularly do. There's a reason why reactors in Japan should have been better prepared for tsunamis and quakes, but weren't. Or for those in Virginia, we were all very lucky when that earthquake happened and our nuclear power plants weren't at the epicenters.
I'm willing to bet that those nuclear power plants have not been reinforced as they should have been.
There's a reason why people choose to have or not to have "go bags". There's a reason why people choose not to have a tourniquet in their home. I could go on. But we all make risk calculations. Sometimes, many times, we make the right choice. Other times we don't.
In business there are ways to quantify risk. One of the most basic ways to quantify risk is to use the 5X5 matrix in conjunction with the monetary value of if the risk occurred. Unfortunately, for Texans, the risk categorization by ERCOT was off. Yet, most of us and most businesses under appreciate the possibility for something wrong to occur. Take living in a 100 year floodplain as an example. You would think that the likelihood of a major flood occurring based on the risk chart below is “Rare”. Therefore, regardless of the severity you decide to buy that home, because let’s face it, you’re not going to live in it for 100 years.
However, since the average American lives in the same home for 13 years, your risk of experiencing a 100 year flood isn’t minimal. In fact, there are two factors contributing to the likelihood of you experiencing a severe flood, 1) the time since the last flood, 2) the accumulation of risk of flood for every year you live in the home. I won't bore you with the mathematical model, but the likelihood that you would experience a major flood in your home, holding the time since the last flood at 0 years, comes out to you having a 12% chance of your home being flooded.
So next time you are considering the risks for different products and projects, don’t skip over your Risk Register and the mitigations. And… next time you’re thinking that your neighbor who has enough water and food to last his family two weeks, a gas power generator, and some other accoutrements to keep the family safe during a disaster, don’t think they’re crazy.
Seriously, I had to go out and help a neighbor break snow and ice so that he could boil water for his family to drink. He didn’t have a hammer or any tools, because as he put it “If something breaks, I just call a handyman to fix it.”
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