Being able to fully understand and analyse an issue, situation or course of action is essential for robust decision-making, improving performance and efficiency, and managing risks.

This was demonstrated recently when a large social enterprise sought our help when facing a £500k legal claim relating to health/injury benefit. If the challenge was successful, it could have pushed the social enterprise into insolvency.

Aside from the potential legal liability itself, we were asked to investigate the organisation’s internal management of the matter, and recommend how similar risks could be minimised.

We identified two problems that had aggravated the issue. Firstly, there was a cultural issue in that the staff involved had been trying to help the individual claimant, rather than protecting the organisation's position. We recommended that our client needed to shift the attitudes of some sections of the workforce to strengthen the cultural alignment with the organisation’s overall values and strategy.

Second, we identified a failure of communication. Rather than notifying the senior management team of the risk, so it could be placed on the risk register reviewed by the Board, the matter had been handled by middle management who did not have the experience or power to make appropriate decisions. This had partly been due to disharmony between two of the central support teams.

We advised the Board on how to ensure that similar matters were managed appropriately in the future. As well as continuing (successfully) to support our client in the initial dispute, we helped it to implement a strategy to ensure that this type of risk would not arise again, and effectively closed off the prospect of future potential liabilities.

Tags: Employment and Pensions2016