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The Roald Dahl Museum
Risk management sounds dry and the consideration of risk at board meetings can easily become a cursory, tick-box exercise with a focus on operational issues.
The Roald Dahl Museum used the Hallmarks framework to refresh their risk register and, in particular, to sharpen the board’s attention to strategic rather than operational risk issues.
“When I arrived there was a lot of operational discussion at board meetings, but I didn’t want the trustees to be stuck on operational detail – that didn’t seem a good use of their time or talent,” says Steve Gardam, who took over as Director in 2015.
“One thing I noticed was that the register seemed to focus on the cause of risk as ‘the risk’. For example, shoplifting from the shop would be talked about as a risk and the impact would be the loss of income. It seemed to me the wrong way round: the ultimate risk is loss of income which could be caused by all sorts of things. A good risk register to me can’t list everything that could happen. The approach I wanted was to identify the big issues that might affect fundamentally the viability of the organisation and deliver a register with regular updates on anything currently affecting those issues.”
At first, Steve used the Hallmarks to clarify his own thinking, drawing on the whole framework to pinpoint where the museum might face significant risks. “Taking the Hallmarks as categories was very useful to consider the big issues. The first Hallmark, and a key one for all museums, is the one about purpose,” he says.
“If one of the Hallmarks of a prospering museum is a clear purpose that’s widely understood by its staff and its board, allowing it to act and make purposeful decisions, then, logically, the strategic risk is that that a museum does not have a clear purpose, leading to all sorts of problems! Back in 2015, I could see that growing as a risk for us: our museum’s purpose was not sufficiently clear.”
Steve then used this identified strategic risk as the basis for a board away day and thorough strategic discussion with the trustees. A new, clear purpose emerged.
“It was very helpful for my board to see how they might adopt a sector standard. It gave my ideas some external validation. It was also true that most of my board are not museum professionals, so they wouldn’t necessarily have encountered the AIM Hallmarks on their own. They appreciated the relevant but external expertise.”
The revised register has been structured so that each of the Hallmarks is a category and the risk is described as what it would mean not to meet that Hallmark.
“We can have more than one strategic risk under each Hallmark, though I try not to have too many,” Steve says. “You could always add more things, but you have to keep asking what are the most important issues, to keep your focus.”
The register lists active risks with a risk score and rating (low, medium, high) and notes and actions being taken to mitigate the risk and by whom. It is a standing agenda item for every board meeting with an update by Steve on new or emerging risks and an update on previous actions. It creates an opportunity for the board to ask questions and potentially identify something that needs to be added as a risk, or an action to be taken to improve mitigation. Changes are logged over time so the Director and board can see at a glance how a risk is evolving.
“We don’t claim the register is ‘fixed’ for all time,” Steve says. “Something might happen next week that we haven’t yet thought about and to which we need to pay attention. It’s a living document in the sense we regularly refer to it but also in that it’s never complete.
“Managing risk is all about handling infinite possibilities, and that’s a huge thing to hold in your head. The Hallmarks give invaluable focus to allow strategic risk to be seen clearly.”