Risk management as a social defence against anxiety

Abstract

Orientation: This article deals with the unconscious role of risk management in an African country. Research purpose: The aim of the study is to describe how risk management unconsciously influences behaviour when doing business in an African country. Motivation for the study: Operational risk management is a rational management imperative. However, this does not take cognisance of the unconscious role of risk management. A systems-psychodynamic perspective might be particularly relevant if the anxiety implied in risk management is not appropriately contained. Awareness of these dynamics may provide an opportunity for addressing them and allow for a more holistic way of managing risk. Research design, approach and method: The researchers conducted the study as a qualitative case study in an African country. They used purposive sampling and analysed the data using qualitative content analysis. Main findings: Viewing risk management from a systems-psychodynamic perspective allowed the researchers to identify the influence of risk management on the behaviour of people. The emerging hypothesis was that, if businesses do not address the anxiety underlying risk management, managing risk becomes a social defence against the anxiety. Practical/managerial implications: Awareness of the anxiety involved in risk management may assist businesses to manage risk in a more realistic way, making provision for, and even capitalising on, the human element. Contributions/value-add: The article provides a systems-psychodynamic, and hence a more complete, perspective of operational risk management when doing business in an African country.

Keywords

• financial institution
• Basel II
• systems-psychodynamic
• control mechanisms
• case study
• African country