How to Avoid Catastrophe

7/27/2019 How to Avoid Catastrophe

1/13

HOW TO AVOID

CATASTROPHE

A presentation

By G-10:

Shruti Gupta

Guldeep Singh

Satyam Kumar

Puneet Jain

Karuna Miglani

Mohit Gupta

Prajwal Menon


2/13

INTRODUCTION

Near misses are not just close calls that could have been a lot worse but they c

be unremarked small failures that penetrate day to day business that cause no

immediate harm.

People commonly misinterpret and ignore the warnings embedded in these fail

Each near miss, rather than raise alarms and prompt investigations, was instead

as an indication that existing methods and safety procedures worked.

Various researches showed that every disaster was preceded by a number of ne

misses and most of these misses were ignored or misread.


3/13

COGNITIVE ERROR

Research shows that particularly 2 cogni tive biasesconspire to blind managers misses.

The first one is: Normali zation of deviance. It is the tendency to accept anomal

particularly the risky ones as normal over the time.

The second cognitive error is Outcome Bias. When people observe successful

outcomes they tend to focus on the results rather than focussing on the process t

to it.


4/13

ROOTS OF CRISIS

Organizational disasters do not have a single cause.

These disasters are triggered by latent errors.

Latent errors are seemingly small, unimportant human errors, technological failu

or bad business decisions.

These latent errors when combined with enabling conditions lead to significant

failures.

Near misses also arise from the same preconditions but in absence of enabling

conditions, they produce only small failures and thus go undetected.


5/13

EXAMPLES

BAD APPLE

Immediately after the launch of Apples iPhone4 in June 2010, customers bcomplaining about dropped calls and poor signal strength.

Apple initially blamed the users only for holding the phone in a wrong way

covering the antenna.

Customers found Apples posture disrespectful and also filed a lawsuit aga

alleging defective design.

This reputation crisis of Apple reached crescendo when consumer reports dto recommend iPhone4.

They eventually had to acknowledge software errors and offered updates to

owners.

If apple would have recognized this latent error and responded, it would ha

avoided this crisis.


6/13

SPEED

WARNING

On August 28,2009, California Highway Patrol officer

Mark Saylor and 3 family members died in a fiery crashafter the pedal of the Toyota Lexus Sedan he was

driving stuck and thus accelerating the car to 120 miles

per hour.

Before that Toyota had received about 2000 complaints

of unintended acceleration among its cars.

Ultimately Toyota halted the sales of its eight models

sustaining an estimated $2 billion loss in North America

alone and a huge damage to its reputation.

Toyota could have averted this crisis by paying

attention to customers complaints and reacting within

time.


7/13

JET BLACK AND BLUE

Since the time of operation jet airways has taken aggressive steps against bad weat

Instead of cancelling flights it asked it pilots to pull away from gates in severe wea

be near the front of the line when runways were cleared for takeoff :even if that me

planes would sit for some time on the tarmac.

For many years it was working fine, but on feb 14,2007 a massive ice storm at Ne

F. Kennedy International Airport caused widespread disruption.

Pilots found themselves stuck on the tarmac and with no open gates to return. Passe

several planes were trapped for upto 11 hours in overheated, foul-smelling cabins wi

or water.

Jet Blue managers ignored the risk and saw only successful launched flights. This w

combined with the enabling condition ie the ferocious ice storm, turned the latent err


8/13

RECOGNIZING AND PREVENTING NE

MISSES

Heed high pressur e

Greater the pressure to meet performance goals such as tight schedules, cost, or produ

more likely managers are to discount near-miss signals or misread them as signs of soun

making.

When people make decisions under pressure, psychological research shows, they ten

heuristics, or rules of thumb, and thus are more easily influenced by biases.

Organizations should encourage, or even require, employees to examine their decisio

pressure-filled periods.


9/13

Learn from deviations

Managers should seek out operational deviations from the norm and examine wh

reasons for tolerating the associated risk have merit.

Eg: As the Toyota and JetBlue crises suggest, managers response when some asp

operations skews from the norm is often to recalibrate what they consider acceptabl

Research shows that in such cases, decision makers may clearly understand the st

represented by the deviation, but grow increasingly less concerned about it.


10/13

Uncover root causes

When managers identify deviations, their reflex is often to correct the symptom rathe

cause.

Eg:Apples response when it at first suggested that customers address the antenna pro

changing the way they held the iPhone.

Eg: A near miss at Delnor-Community Hospital, in Geneva, Illinois. Two patients shar

room had similar last names and were prescribed drugs with similar sounding namesC

Cytoxan. Confused by the similarities, a nurse nearly gave one of the drugs to the wrong

Luckily, the mistake was caught in time .The hospital immediately separated the patients

policy to prevent patients with similar names from sharing rooms in the future.

Demand accountability

Even when people are aware of near misses, they tend to downgrade their importance

limit this potentially dangerous effect is to require managers to justify their assessments


11/13

Worst-case scenario

People tend not to think through the possible negative consequences of near misses

Apple managers, for example, were aware of the iPhonesantenna problems but pr

imagined how bad a consumer backlash could get. If they had considered a worstcase

might have headed off the crisis, research suggests.

Evaluate projects at every stage

When things go wrong managers evaluate it.

When they go well, only few do formal reviews of the success to capture its lesson

misses can look like successes, they often escape scrutiny.

Eg:Edward Rogers, chief knowledge officer at NASA instituted a pause and learn

which teams discuss at each project milestone what they have learned.


12/13

Reward owning up

Seeing and attending to near misses requires organizational alertness, but no am

attention will avert failure if people arent motivated to expose near misses or eve

are discouraged from doing so.

E.g.: An enlisted seaman on an aircraft carrier.


13/13

THANK YOU

How to Avoid Catastrophe

Documents

How to Avoid Catastrophe