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Risk Assessment and Management Process
- 1. Risk Assessment and Management Tanmoy Sinha 07 June, 2019
- 2. Outline 2 • Objectives of Risk Assessment and Management • Definition of Risk • Definition of Assessment and Management • Risk Analysis Framework • Five Steps to Risk Assessment • Typical Example of Risk Assessment Process • Definition of Risk Management • Phases of Risk Management Process • Typical Example of Risk Management Process • Failure of Risk Management (A Short Video Clip) • Summary • Acknowledgments
- 3. Objectives of Risk Assessment and Management: 3 Control of Risk Analysis of Risk Detection of Risk
- 4. Definition of Risk 4 What is Risk = Likelihood × Consequence
- 5. Definition of Risk 5 What is A chance of losses The possibility of unfortunate occurrence Occurrence of economic loss Probability of something happening that is unwanted and unavoidable without precaution
- 6. Typical Example of Risk 6 Safety risk Asset loss or damage Reputation al Risk Financial risk Risk Operational risk Environmental risk
- 7. Typical Example of Risk 7 Source: www.educba.com
- 8. Typical Example of Risk 8 Source: www.giphy.com Source: www.tenor.com
- 9. Definition of Assessment and Management 9 • Evaluation or estimation of the nature, quality, or ability of someone or something. • E.g. Risk assessment, Educational assessment Assessment • Process of dealing with or controlling things or people. • E.g. Risk management, Financial management Management
- 10. Risk Analysis Framework 10 Risk Assessment Risk Management Risk Communication Risk Analysis Framework Risk Assessment Risk Management ▪ Hazard identification ▪ Data gathering ▪ Failure probability estimation ▪ Risk determination • Risk evaluation • Action recommendation • Action implementation • Monitoring
- 11. Definition of Risk Assessment 11 The overall process of hazard identification, failure estimation, data gathering and risk determination. What is Risk Assessment
- 12. Five Steps to Risk Assessment 12 Identify the hazard Decide who might be harmed Evaluate the risks and decide on the precautions Record the findings and put them into place Review the risk assessment
- 13. Five Steps to Risk Assessment 13 Step 1: Identify the hazard Walk around your workplace and look at what could reasonably be expected to cause harm. Ask your employees what they think. They may have noticed things that are not immediately obvious to you. Check manufacturers data sheets for chemicals and equipment as they may identify hazards. Look over accident books as they may contain information not immediately obvious to you.
- 14. Five Steps to Risk Assessment 14 Step 1: Identify the hazard Late risk identification Source: quality-one.com
- 15. Five Steps to Risk Assessment 15 Step 1: Identify the hazard Early risk identification Source: quality-one.com
- 16. Five Steps to Risk Assessment 16 Step 1: Identify the hazard Six Dimensional Hazard Identification Source: www.ask-ehs.com
- 17. Five Steps to Risk Assessment 17 Step 2: Decide who might be harmed ❖ For each hazard, you need to be clear about who might be harmed ❖ Don't just think about those carrying out the task. ❖ If the task creates dust or fumes, that could spread to other workers nearby. Consider: -The worker or operators -Adjacent workers -Visitors -Other occupants -Members of the public
- 18. Five Steps to Risk Assessment 18 Step 3: Evaluate the risks and decide on the precautions Can I get rid of the hazard altogether? If not, how can I control the risks? Provide welfare facilities (eg first aid and washing facilities) Issue personal protective equipment (eg clothing, footwear, goggles) Organise work to reduce exposure (eg put barriers) Prevent access to hazard (eg by guarding)
- 19. Five Steps to Risk Assessment 19 Step 4: Record the findings and put them into place A proper check was made You asked who might be affected You dealt with the obvious significant hazards You involved your staff/their representatives in the process
- 20. Five Steps to Risk Assessment 20 Step 5: Review the risk assessments Any significant changes Any improvements that still need to be made Have your workers spotted anything? Have you learnt from accidents?
- 21. Typical Example of Risk Assessment Process 21 Identify the hazard • Deep drainage excavation in bad ground Decide who might be harmed • Pipelayers in trench Evaluate risks and decide on precautions • High risk of collapse • Use steel trench drag box Record the findings • Fill the risk assessment sheet. Review risk assessment • Monitor site operations and modify risk assessment where necessary. Project: Underground Piping
- 23. Definition of Risk Management 23 The practice of risk evaluation, action recommendation, implementation and monitoring to reduce or eliminate the risk situation
- 24. Phases of Risk Management Process 24 Risk Management Risk Analysis Risk Treatment Monitor and Review
- 25. Phases of Risk Management Process 25 Analyse inherent risk What is the likelihood and consequence of a risk event if it were to occur in an uncontrolled environment? Identify and evaluate controls What existing controls are in place to address the identified risk and how effective are these controls? Analyse residual risk What is the likelihood and consequence of a risk event if it were to occur in the current control environment? Phase 1: Risk analysis
- 26. Phases of Risk Management Process 26 Phase 1: Risk analysis Risk Condition Action Extreme / High-Risk Serious danger. Immediate action required in this type of risk Medium Risk Moderate danger. Action as soon as possible to implement controls to reduce the risk to as low as reasonably practical Low Risk It may range from minor to negligible danger. Assess if further action can be taken.
- 27. Phases of Risk Management Process 27 Phase 1: Risk analysis
- 28. Phases of Risk Management Process 28 Phase 1: Risk analysis
- 29. Phases of Risk Management Process 29 Phase 1: Risk analysis
- 30. Phases of Risk Management Process 30 Phase 1: Risk analysis
- 31. Phases of Risk Management Process 31 Phase 1: Risk analysis Likelihood of risk impact = σ𝑖=1 𝑛 𝐿𝑖 Consequence of risk = σ𝑖=1 𝑛 𝐶𝑖 Risk = σ𝒊=𝟎 𝒏 (𝑳𝒊 × 𝑪𝒊) Jin H, Batta R. (1984)
- 32. Phases of Risk Management Process 32 Phase 1: Risk analysis Typical Likelihood Scale: Level Likelihood Description 4 Very likely Happens more than once a year 3 Likely Happens about once a year 2 Unlikely Happens every 10 years or more 1 Very unlikely Has only happened once Typical Consequence Scale: Level Consequence Description 4 Fatality Financial losses greater than $50,000 3 Major injuries Financial losses between $10,000 and $50,000 2 Minor injuries Financial losses between $1000 and $10,000 1 Negligible injuries Financial losses less than $1000
- 33. Phases of Risk Management Process 33 Phase 2: Risk treatment • Deciding not to proceed with the activity that introduced the unacceptable risk Avoid the risk • Implementing a strategy that is designed to reduce the likelihood or consequence of the risk Reduce the risk • Implementing a strategy that shares or transfers the risk to another party or parties Share or transfer the risk • Making an informed decision that the risk rating is at an acceptable level or that the cost of the treatment is low Accept the risk
- 34. Phases of Risk Management Process 34 Phase 3: Monitor and review • Ensuring that controls are effective and efficient in both design and operation • Obtaining further information to improve risk assessment • Analysing and learning lessons from risk events • Identifying emerging risks.
- 35. 35 Typical Example of Risk Management Process Project: Underground Piping Risk Risk Analysis Risk Treatment Monitoring High risk of collapse Likelihood Consequence Action Accept the risk Regular monitoring to ensure the effectivenessVery likely Major injuries High Install steel trench drag box
- 36. 36 Risk Management Software nTask Resolver TimeCamp Integrum Qualys CURA Source: www.ntaskmanager.com
- 37. Failure of Risk Management (A Short Video Clip) 37 Banani (Bangladesh) FR Tower Fire Tragedy: Source: www.youtube.com
- 38. Summary 38 The goal of risk management is to take corrective actions to reduce the impact and likelihood. The impact can be reduced by controlling the sources from which they arise and instituting limits to the exposures. There are some risks that cannot be either eliminated or transferred and must be absorbed by the organization. To manage the risks, we have to establish a good bondage between all team members. Risks are not always negative and it is an opportunity to develop a project in a better way with good outcome.
- 39. Summary 39
- 41. 41 Thank You