Posted tagged ‘risk-taking’

Ālea iacta est

January 10, 2010

A friend of mine recently described a moment to me that, I suspect, we have all experienced at some stage. For a while he had wanted to leave his employment, as it was making him unhappy and dissatisfied. But he had always hesitated, not quite knowing what he would do instead. Until one day, when he was feeling particularly disillusioned, he drafted an email to his boss, in which he told him how much he hated the job, and giving his notice. For a moment or two he hesitated, then he clicked ‘send’. And in that tiny moment, just as he had done the deed, he felt strongly that it had been the wrong thing to do, but irrecoverable. ‘Ālea iacta est‘ (‘the die is cast’),he mumbled to himself.

Well, 2059 years ago today exactly those words were spoken by Julius Caesar as he crossed the Rubicon, thereby giving us two figures of speech that are still used today. The Rubicon, a small and geographically unimportant river in Northern Italy, had a special significance in Roman military law. It could not be crossed by any Roman army division (Legion); the purpose of this prohibition was to prevent dissident generals from mounting an attack on Rome from points to the north of Italy. Julius Caesar had at this point succeeded in subduing Gaul (France), and because he had achieved great popularity on account of his military successes he was considered a threat by the powers that be, who ordered him to disband his troops. Caesar chose to disobey this instruction, and on January 10, 49 BC, he made up his mind and crossed the Rubicon, thereby making armed confrontation inevitable.

We all have these moments in our lives when we understand that something we are about to do may have a huge significance, and that once it is done done we cannot return to where we were. And we can all feel both the thrill and the horror of the knowledge that we have passed the point of no return. But we also know that, at certain points in our lives or in the life of those around us, we need to take these steps and be decisive in doing so. The willingness to take a risk and to accept the consequences is one of those key features that brings us progress and innovation, and we need in our society to nurture that willingness and not to punish it when, sometimes, things do not work out. Cautious risk avoidance will, if we allow it to govern our actions, push us inevitably into decline.

College disasters and their causes

March 27, 2009

By now we have become accustomed to the parade of disaster stories from financial institutions, and on the whole we now know how they got themselves – and us – into the major messes we have witnessed. But now the question is occasionally being asked whether higher education institutions will also start to hit the headlines for these reasons. There have been plenty of stories about deficits, and some of these look serious. But the first major crisis story in Ireland is from Waterford, where the Institute of Technology has hit major financial problems.

According to a recent article in the US Chronicle of Higher Education, a large number of American institutions are in crisis, with budget cuts and lay-offs. But the writer indicates that this is not all down to the bad economic environment; many of them took poor decisions during the good times that have now come to haunt them. The article describes thirteen such reasons, including risky investments, relying on too much cheap credit, too many capital projects, poor political lobbying, the failure to focus on appropriate niche areas.

It is well worth while reading this analysis in full. But it is also important to note that a common theme of much of this is that the institutions took risks; and as we know, risks can go wrong. So what we now need to ask ourselves is how good we are at evaluating risk and developing our strategies accordingly. It cannot be right to suggest that we should only act prudently and avoid all risks – to do that would mean never to innovate. But not all risks are good risks, and we need to be able to identify the more likely bad ones.

My view is that, on the whole, Irish universities have not been bad at this, and while there have been some initiatives (as you would expect) that didn’t work, or didn’t work as well as expected, or didn’t work immediately, there have been many others that have been spectacular successes; and few life-threatening disasters. But if we are now to be yet more entrepreneurial (as we should be), we need to have a shared framework that represents best practice in identifying risks and assessing the wisdom of taking them. In the overall planning framework for higher education institutions, this should become one of the priorities.