On the weekend my seven year old was asking me some hard questions about how Santa manages his risks during Christmas.
- What if he gets sick?
- What if he runs out of presents?
- What if there is a storm!?
Keeping in mind my son does not know that my profession is to help people with risk management, who just like Santa manage risk in their business everyday.
Now I can’t give any real advice on what happens at the North Pole, it does seem worthwhile to address these “risks” as they are relevant to many business owners here in Australia too.
Could Your Business Deliver Christmas?
It’s fair to say that Santa is the ultimate leader and CEO – he has consistently delivered EVERY Christmas, without fail, so how does he do it?
The North Pole is a multi-billion dollar business, with 2 billion customers with incredibly high expectations, there is no room for error. To reach such scale and scope, and work within tight time frames as a CEO Santa & his team must have a strong emphasis on risk management and contingency planning.
Jingling All The Way: Santa’s 11 Steps To Risk Management
1.Staffing: the Head Elf has a contingency plan to re-allocate staff from non-essential duties to help with the Christmas rush. All Elves are fully educated on policy and procedures in the event of an incident – equipment failure, natural disasters, damage, theft or even a privacy breach.
Nothing is left to chance. Sourcing a competent Head Elf is a critical part of Santa’s operations. He is Santa’s “eyes and ears”.
2. Equipment Failure: Santa relies on his factory to produce enough toys to ensure there are no delays in delivery – he’s unable to allow for any tolerance as there is one night only when the deliveries must occur – no exceptions.
He has machines on stand-by in case one breaks. If there is a power outage he has generators at the ready. He also ensures that equipment is regularly serviced to avoid issues and they are kept on a constant rotation. All inventory orders are kept in a manual file (just in case of a cyber attack or tech fail).
3. Supplies: A backup stash of toys is available at a minute’s notice. He has a manual payment system as a back-up in case he needs to order in last minute supplies and raw materials.
Santa also ensures he uses quality materials in his factory reducing the risk of product failure.
4. Transportation: Santa not only has the latest in sleigh design, he has a back-up just in case the main sleigh is out of commission. Santa has 2.1 billion children to visit – there is no room for error.
BEFORE he departs he makes sure he has the correct Air Traffic control clearance. His sleigh carries all the necessary documents including his licence and insurance.
5. Burnout: Santa has an incredibly responsible job, with kids all around the world relying on him this presents a high risk of burnout. As such, Santa has identified roles and tasks that can be out-sourced to other staff members, ensuring that he only takes on the tasks that are absolutely crucial he complete and is qualified for. Santa is a master delegator.
6. Technology: Santa is the inventor of “big data” – how else does he manage a list that covers the entire population of children?
He has the latest systems installed that protect him from cyber-crime and has a back-up off site to ensure that in the event of a disaster, he could recover all his data. Santa publishes his privacy and data protection policies clearly, and all Elves have appropriate training on safe handling of children’s data.
7. Damage and Theft: Santa has the latest high tech security system and 24 security patrolling the premises. As the factory is the most critical element to his operations, he has invested in state of the art security systems.
8. What If Santa Got Sick Or Injured? One of the biggest risks of being a “one man” show is that if Santa is unable to perform his duties what happens?
As a contingency – Santa employs a back-up elf to drive his sleigh in case he becomes unwell during the trip. Because all the routes and children’s presents are pre-allocated he can confidently hand the task over to his co-driver.
Also, Santa has a solid succession plan, Mrs. Claus knows everything about the operation of the factory and delivery of presents and can easily step in if she’s needed to lead the team.
9. Adverse Weather Events: alternate routes need to be created in case adverse weather events or natural disasters means Santa cannot travel through certain regions. All types of weather events have been prepared for and a contingency plan is in place.
10. Insurance: Santa cannot control every aspect of his operations. As such he makes sure he has the right insurance policies in place.
Insurance protects Santa in the event the wrong present is delivered to a child, a present is not working or a child throws a tantrum and demands another present in replacement. Santa also has Key-Person insurance – just in case.
11. Reputation: Reputation management is critical to Santa. He cannot run the risk of having bad reviews or negative press. Therefore he out-sources his PR and marketing to his team of Influencers (i.e. parents), who consistently and diligently ensure Santa’s reputation remains in-tact.
Hit me up if you have any questions or if you know something I don’t about how Santa runs his operations in the North Pole. And please have a wonderful Christmas and a very happy & safe new year!