Some of my clients are what are known as secondary consultants.
As secondary consultants they subcontract to a primary consultant.
If they are not careful, they end up taking on the risks of the primary consultant.
In The Fat Tail, The Power of Political Knowledge for Strategic Investing, authors Iam Bremmer and Preston Keat offer 6 practical ways to deal with risks and uncertainty.
- Isolating: You can isolate and separate critical assets, either to lower their overall vulnerability or simply to ensure that not all our critical assets are open to the same set of threats at the same time.
- Smoothing: You can distribute risks over time and across various theatres, business subsidiaries and entities.
- Warning: You can establish warning systems to better prepare for specific contingencies.
- Agility: You can reduce the time and costs and response to crises and lower the risks associated with them.
- Alliances: Alliances among firms and private corporations, non-governmental organisation (NGO’s), international instsiutions, and private stakeholders can help mitigate the risks inherent in uncertainty by spreading risk among them.
- Environment Shaping: You can mitigate risk by influencing the environment where they operate.
Consider these six approaches when you face having to negotiate a complex, risk riddled contract.
Read Bremme’s and Keat’s book The Long Tail as well. It is powerfully argued. Bremmer and Preston Keat have played in the political risk management game for years.
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