Learning from Catastrophes: Strategies for Reaction and by Howard Kunreuther, Michael Useem

By Howard Kunreuther, Michael Useem

Events starting from typhoon Katrina to the worldwide fiscal main issue have taught businesspeople an unforgettable lesson: for those who don’t plan for “extreme risk,” you endanger your organization’s very survival. yet how will you plan for occasions that pass a ways past whatever that happens in common daily enterprise? In Learning from Catastrophes, two popular specialists current the 1st accomplished strategic framework for assessing, responding to, and coping with severe threat. Howard Kunreuther and Michael Useem construct on their lonesome step forward paintings on mitigating normal failures, extending it to the demanding situations confronted via real-world firms.

Along with the contributions of major specialists in probability administration, heuristics, and catastrophe restoration, they establish the behavioral biases and defective heuristics that misinform selection makers concerning the chance of disaster. They move directly to determine the hidden hyperlinks linked to severe hazards, and current suggestions for systematically construction higher resilience into the association.  The worldwide best-seller The Black Swan told executives that “once in an entire life” occasions are way more universal and hazardous than they ever discovered. Learning from Catastropheshows them precisely what to do approximately it.

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Thus, the comprehensive risk-management approach helps us to explore and develop opportunities for investment and thus helps generate actionability. The remaining problem for acting in time against this hazard, then, is mobilizing communities to actually undertake the resulting, more balanced set of investments. This is a problem of political visioning From the Library of Daniel Johnson 2 • ACTING IN TIME AGAINST DISASTERS 39 and of developing the will to act, and it has proven immensely difficult to solve.

A more balanced analysis, structured by the comprehensive risk-management framework, will allow us to formulate a more judiciously balanced array of investments—and, thus, to reduce expected future social losses substantially. It is reasonable to ask what institutions might conduct this crossagency, cross-jurisdictional, cross-level-of-government analysis and how the decision-making process might be structured. 18 PPBS was much less successful than desired, in part because even when analysis of major “programs” in the Defense Department alone were conducted, it was exceedingly difficult to make and enforce executive decisions based on this analysis.

The program will simply deal with whatever damage exists and try to rectify it. Traditionally, then, the work of recovery is understood to begin (well) after the event is over and the response has ended or is imminently ending, and it is time to begin rebuilding the community and its various assets that were damaged by the event. Recovery—and actions to support recovery, like planning and community mobilization—are understood to take place after the fact. 11 From a logical perspective, however, there is no reason that at least some recovery activities cannot be undertaken before an event takes place.

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