A Complex, Swirling Mess
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People, Planet, Profits, and Projects – that’s been the name of this blog since its inception. If ever there was a post that truly lived up to this blog name, it’s this one (well, actually two, because it’s too good to fit in only one post). This post was triggered by a very short story on NPR which you can listen to right now, and I suggest that you could do just that – stop reading and have a listen: The gist of the story is that People, concerned with how the Planet's climate is changing, are able to generate Profit by initiating Projects and starting up companies that focus on how to best deal with the changes that are predicted. See that? People, Planet, Profit, and Projects! In this Part 1, I’ll focus on the high level ideas raised in the story and some follow-up research. In Part 2, I will take you into some of the details and take a look at one of the companies which has arisen with this specialized expertise in climate change and its effects on cities, regions, and organizations. The title of this post, “A Complex Swirling Mess”, comes from a description given by actuary Rebecca Owen, who advises healthcare companies and insurers about the effects of climate change based on data. Between heat waves, droughts, dust, pollen, rainfall, and traffic accidents (just as a sample), she describes the combined effects of climate change with that term. It turns out that the entire aspect of actuarial science and the factual study of climate data is very interesting to me as a project manager, who wants decisions based on facts. Actuaries – well, that’s what they do. They aren’t politicians, they don’t work for Greenpeace, they have no “axe to grind”, they simple bear down and focus on statistics and what it means for the future. What does an actuary do? According to the Society of Actuaries, they are “professionals in the modeling and management of financial risk and contingent events”. Sounds interesting to us as project managers, right? In fact, this is the theme of Chapter 11 of the PMBOK® Guide, isn’t it, although focused on a particular project rather than an entire business. So what does the actuarial field find when they study climate change? Well, they find the risk trigger for a complex, swirling mess, as indicated by findings such as a steadily increasing amount and intensity of extreme weather and issues related to such things as sea level rise. The SOA, or Society of Actuaries, has created a Actuaries Climate Index™ and it shows a troubling trend when it comes to extreme weather. Here is their press release: Organizations representing the actuarial profession in Canada and the United States today updated the Actuaries Climate Index™, an objective, quarterly measure of changes in extreme weather frequency and sea level. The Actuaries Climate Index value for fall 2016 was 2.07, the highest seasonal level recorded for the United States and Canada combined. The current five-year moving average is 1.07, the highest level recorded for that measure. The index is available online at ActuariesClimateIndex.org. The key ACI chart is show below:
So the next question, and the topic of the larger Part 2 of this post, is, what can we do with this information? Just as in a project, when we get information about risk, we can ignore it, or we can work it into our planning for the future (the better choice, I would argue). Some organizations are working with the information themselves, and other businesses have sprung up which specialize in advising and consulting with solid information from these actuarial sources and directly from scientists and researchers. They’re taking the best from business, government, and academia to sell intelligence on how to plan for a changing climate. And it’s no small deal. In 2017 there were 16 major weather disasters which cost over $300B in damage, affecting an estimated 16% of the US population alone. So, some companies are turning this threat into an opportunity. Tune in to Part 2 to see why and how they are doing it. |
