Six Thinking Hats for Enterprise Risk Management

October 2012 Bonus Resource

I recently revisited the book Six Thinking Hats by Edward de Bono. The powerful central idea is that rather than approaching decision-making as an argument to be won (or lost), instead the Six Hats method defines the full range of thinking approaches that are required for generating creative strategies to achieve business goals and solve whatever problems arise along the way.

de Bono defines the ways of thinking as these six ‘hats’:

  • White Hat: White is neutral and objective. The white hat is concerned with objective facts and figures.
  • Red Hat: Red suggests anger (seeing red), rage and emotions. The red hat gives the emotional view.
  • Black Hat: Black is somber and serious. The black hat is cautious and careful. It points out the weaknesses in an idea.
  • Yellow Hat: Yellow is sunny and positive. The yellow hat is optimistic and covers hope and positive thinking.
  • Green Hat: Green is grass, vegetation and abundant, fertile growth. The green hat indicates creativity and new ideas.
  • Blue Hat: Blue is cool, and it is also the colour of the sky, which is above everything else. The blue hat is concerned with control, the organization of the thinking process and the use of the other hats.”

To apply the Six Hats method, all the team members imagine themselves all wearing one hat at a time. They cycle through the various hats at different points in the decision making process. The team matches the hat to the specific nature of the issue to be resolved. For example, white hat thinking could be used to focus on identifying what is known about a particular risk, what is not known, the assumptions, etc. Green hat thinking could be used to design risk response strategies.

The method ensures that the team has a fulsome discussion
about the problem, generates a good set of potential solutions and then thoroughly examines the options to arrive at an optimal decision.


Traditional risk management approaches tend to restrict people’s thinking
to the black hat. Consequently, creativity is stifled and the perceived relevance of the ERM discipline suffers.

de Bono explains that the emphasis of the Six Hats method is “on ‘what can be’ rather than just on ‘what is’, and on how we design a way forward.” Isn’t that exactly what is needed to imagine risks (both threats and opportunities) that may occur, explore the implications of those risks and develop solid management strategies to manage them?

For details and to order this book, follow this link to the Risk Wise Reading List:

http://riskwise.ca/risk-management-reading-list.html


Please let me know about the books that have helped you to be a more effective leader
on your enterprise risk management journey.

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Diana's Pick

Neuroscience and the Nonprofit Manager (written by Andy  Segedin and published in the NonProfit Times) shares some of the tips on how to counteract common biases and habits that impede effective decisions.

The article is based on a workshop that Diana Del Bel Belluz of Risk Wise presented at the 2015 Risk Summit organized by the Nonprofit Risk Management Center.