Today, companies are faced with ever-increasing complexity. On the one hand, companies themselves are complex, socio-technical systems, and on the other hand, they are embedded in a complex environment with numerous known and unknown factors. How can an organization successfully keep up with these constantly increasing demands?
In this article, I will focus on High Reliability Organizations (HRO) and the related High Reliability Theory (HRT). The idea of High Reliability Organizations originally comes from organizations that successfully operate in high-risk industries. Examples include air traffic control, nuclear power plants, aircraft carriers, power grid operators, and similar fields of activity. However, I am personally convinced that the insights gained from HRO and the associated operational principles can be transferred to any organization and – like the classic HRO – will make them more successful.
The emergence of the High Reliability Theory
In 1984, sociologist Charles Perrow published his book “Normal Accidents: Living with High-Risk Technologies”, in which he introduces the Normal Accident Theory (NAT) using an analysis of the reactor accident in the nuclear power plant Three Mile Island in the USA in 1979. His reasoning was that complex and tightly coupled systems would have to lead to a catastrophic accident sooner or later. It therefore was irresponsible to operate such systems, for example nuclear power plants. This theory appears to be absolutely plausible; however, it holds a problem: it cannot be falsified. Because – and this several times was Perrow’s answer to criticism – even if there has never been an accident, it is just a matter of time before it happens. Who can refute a forward-looking statement?
NAT has rightly received a lot of attention in safety sciences and Perrow has been cited thousands of times. But the question arose as to why there are still organizations that can successfully operate complex, tightly coupled systems with virtually no incidents. This question inspired the Berkeley scholars Gene I. Rochlin, Todd R. La Porte, and Karlene H. Roberts to study such organizations more closely and to publish an article on High Reliability Organizations in 1987 in response to Perrow’s NAT: the High Reliability Theory (HRT). Using a best-practice approach, the Berkeley scholars examined why operations on an aircraft carrier (in peacetime), where aircraft move at high speed and in tight space in the presence of dangerous goods such as fuel and weapons, do not (or did not yet) lead to a catastrophic accident.
Like NAT, HRT received a lot of attention. As a result, it was followed by numerous publications, and there are still articles and books published today on this topic. Of course, Perrow’s answer to HRT did not wait. While the Berkeley scholars considered their work as complementary to NAT, Perrow didn’t agree with this assessment and contradicted directly. After 1987, numerous studies and surveys were conducted in different industries such as nuclear power plants, aircraft carriers (in peacetime), power grid operators, air traffic control, etc. These studies have contributed to the further development of the HRT. In 2001, Karl E. Weick and Kathleen M. Sutcliffe published the first edition of “Managing the Unexpected”, in which they broke down the findings to five HRO principles that I will explain further down. “Managing the Unexpected” was published in a second edition in 2007 and in a third edition in 2015.
The five HRO principles
The first three of the five HRO principles are primarily to be understood from a prevention perspective. The focus is on preventing serious incidents and accidents.
Preoccupation with failure. To deal with possible failure means to think about what could go wrong and to look for weak signals in the system. These are activities that can be taken over by effective risk management but should also be firmly anchored in the everyday work routine of all employees. When analyzing risks, it is important to understand what could happen. However, it is even more important to get to the bottom of the question of why something could happen.
Reluctance to simplify. We tend to look at something in a way that fits our personal worldview. This applies to both individuals and entire organizations. With the reluctance to simplify, the existing worldview is questioned, and situations are viewed from different perspectives.
Sensitivity to operations. In an HRO, operational processes set the pace of the organization. The organization has a high awareness of details and identifies weak signals. The quality of relationships is strong. There is a culture of trust, which enables employees to speak openly about irregularities and concerns in connection with operational processes.
But an HRO is also aware that, despite all efforts, mistakes cannot be completely avoided. The last two of the five HRO principles focus primarily on coping with errors so that they do not develop into a crisis.
Commitment to resilience. Errors also occur in HROs. HRO do not try to be error-free, but on the one hand they have the ability to quickly recover from mistakes before a crisis arises, and on the other hand they have the ability – if a crisis does occur – to quickly get out of this crisis.
Deference to expertise. If an HRO is in a critical situation or even in a crisis, the decisions to deal with this situation are made “at the front” by the relevant experts and not necessarily by the management. Figuratively speaking, the hierarchy pyramid turns upside down. Once the crisis has been overcome, the hierarchy pyramid will normalize again.
Why become a High Reliability Organization?
The five HRO principles support a company to become a mindful organization that is able to focus on operational processes, detect weak signals, learn from irregularities, and manage potentially dangerous situations before they turn into a full-blown crisis. The benefits that result from this are manifold. For example, losses in connection with a crisis – be it a production shutdown or a far-reaching scandal – can be avoided or limited, or a significant competitive advantage can be achieved by optimizing operational processes. If a company is perceived as an HRO from outside, this can have a positive impact on public perception and can also play a decisive role in the war for talent.
In conclusion, it can be said that the concept of the High Reliability Organization not only supports companies in high-risk areas, but basically supports all companies in successfully sustaining themselves in their increasingly complex environment and in creating a competitive advantage.