Relationship Risk Management – Blog by Tarun Agarwala

The sharper your Relationship Risk Management, the greater your risk appetite to pursue any mission in life.

Whether you seek to change your role, organization, industry, or country, your ability to navigate ambiguity depends on the strength of your relationships. The quantity and quality of your relationships determine how future-proofed you are.

A more sophisticated term for being future-proof is Resilience. In simple terms, resilience means having the capacity to absorb difficult news due to strong fundamentals and the agility to adapt to rapid change.

Resilience in individuals, leaders, and workers translates into resilient organizations and communities. While productivity serves as a key metric for achieving short-term goals, resilience ensures perseverance, enabling the organization or group to stay committed to its mission and achieve its long-term visions.

There are three components of Relationship Risk Management:

1. Development of High Cross-Cultural Emotional Granularity

This is the ability to perceive and distinguish nuanced, discrete emotions — both in oneself and in others from diverse cultural and linguistic backgrounds. This requires a large emotion vocabulary.

2. Understanding the Limitations of Empathy

That is recognizing when empathy is beneficial and when it is counterproductive. Empathy can lead to burnout, manipulation, and biased decision-making.

3. Developing the Habit of Rational-Empathy

This is a strategic skill that reduces susceptibility to manipulation, minimizes the urge to exploit others, mitigates in-group bias and compassion fatigue, and increases the probability of achieving “best collective outcomes” in every interaction.

To apply these elements effectively, a structured framework is necessary. This framework should provide a systematic approach to developing Rational-Empathy and include a unit of measurement to track progress. Without a measurable system, growth in this skill will remain abstract and inconsistent.

One such framework is the “Interpersonal Trust Growth Framework” developed at my lab.

For more insights, connect with Tarun Agarwala on LinkedIn