RISK MANAGEMENT

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Risk Management
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Risk Management
AR-385-10
The following principles will be effectively
integrated into all Army plans, programs,
decisions processes, operations and
activities (1) Accidents are an unacceptable
impediment to Army missions, readiness, morale,
and resources hence, their prevention will be
aggresively pursued. (2) Decision makers at
every level will employ risk management
approaches to effectively preclude
unacceptable risk to the safety of personnel
and property.
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Risk Management
The purpose of risk management is to identify
operational risks and take reasonable measures to
reduce or eliminate hazards. Risk management
allows us to operate successfully in high-risk
environments. RM is executed through
identification of hazards, implementing measures
to reduce or eliminate hazards, and then accept
ing risk only to the point that the benefits
outweigh the potential losses.
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Risk Management
ACCIDENT CAUSATION FROM UNSAFE ACTS, UNSAFE
PRACTICES AND UNSAFE CONDITIONS
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Risk Management
ACCIDENT PREVENTION THROUGH SITUATIONAL
AWARENESS AND RISK MANAGEMENT
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Situational Awareness is knowing where you are
and what is going on around you at all times.
When properly applied, situational awareness
promotes foresight into hazard identification and
accident prevention.
Risk Management
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Risk Management when properly applied, enables
the individual to maximize safety and
capabilities while minimizing risk to self,
others, mission and craft.
Risk Management
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Results of Unchecked Risk
Risk Management

• Accidental deaths injuries

Diseases/ illnesses
Civil criminal liabilities
Mission SELF Others
Environmental degradation
Loss theft of materiel funds
Accidental destruction of materiel/facilities
Loss of public trust confidence
These risks can be minimized if they are
effectively detected and controlled - Risk
Management
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The Dimensions of Risk
Risk Management
The relative significance of each type of risk
varies
Mission
Fiscal
Training Value
Safety
Types OF RISKS
Personal
Security
Environmental
Legal/Media
Changing one element often influences other
elements positively or negatively.
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Battle and Non-Battle Casualties
Risk Management
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Risk Management
Results of Aggressive RM
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Key Definitions
Risk Management

• Hazard - A condition with the potential of
  causing injury or death to personnel or damage
  or destruction to equipment or property.
• Risk - An expression of possible loss over a
  specific period of time or number of operational
  cycles.
• Risk Assessment - The process of detecting
  hazards and systematically assessing their
  overall risk.
• Risk Management - The process whereby decisions
  are made and implemented regarding the control of
  risk.
• Gambling - The process of making risk decisions
  without applying risk management processes.

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Risk Management
Four Rules of Safety Risk Management

• Manage risk in the concept and planning
  stages of any endeavor
• Accept no unnecessary risk
• Make risk decisions at the right level
• Accept risks when benefits outweigh costs

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THE RISK MANAGEMENT PROCESS
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RISK ASSESSMENT MATRIX
PROBABILITY
FREQUENT
LIKELY
OCCASIONAL
SELDOM
UNLIKELY
A
B
C
D
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SEVERITY
EXTREMELY HIGH
I
CATASTROPHIC
HIGH
II
CRITICAL
III
MEDIUM
MARGINAL
LOW
IV
NEGLIGIBLE
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Hazard Severity

• Catastrophic Death or permanent total
  disability. System loss, major property
  damage.
• Critical Severe injury, permanent partial
  disability. Temporary total disability.
• Marginal Minor injury, lost workday accident.
  Minor system impairment.
• Negligible First aid or less required.

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Hazard Probability

• Frequent Occurs often in life of system or
  career.
• Likely Occurs several times in a life of
  system or career.
• Occasional Will occur life of system or
  career.
• Seldom Unlikely but could occur

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Hazard Detection Resources

• Experience
• Experts
• Regulations and Manuals
• Accident Data
• Scenario Thinking

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Mission Risk Assessment Decision-Making

• Gather information analyze factors to identify
  hazards
• Complete risk assessment for each course of
  action (COA)
• Use risk level of each COA as a decision

• Make risk decision for selected COA - accept risk
  level or elevate decision
• Identify and select controls for hazards

• Communicate and implement controls

• Supervise - monitor and enforce controls

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Risk Management
SYSTEMIC CAUSES OF ACCIDENTS

• Individuals lack skills to perform assigned task
  or fail to follow the standards.
• Management that fails to manage risk effectively
  or fail to enforce the standards.
• Organization standards that are not right for the
  mission or no SOP in place outlining the
  standards.
• Training not to the standard and fails to
  provide essential skills knowledge for
  indiviual to execute tasks.
• Support elements that fail to provide essential
  services necessary to complete the mission.

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Risk Management
Applications of Risk Management
Risk Management Near Term
Risk Management Opportunity
Risk Management Long Range Readiness
Sound risk control foundation necessary to
perform optimally

• Individuals possessing essential skills
  positive attitudes
• Management who can manage risk effectively
• Organization standards that are right for the
  mission
• Training that provides essential skills
  knowledge
• Support elements that provide essential services

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Risk Management
Risk Management QUIZ
1. List, in correct sequence, the five steps of
the management process. 2. Explain the
difference between risk management and risk
assessment. 3. List the four rules of risk
management. 4. What is the key word for each of
the four rules of risk management. 5. List the
three levels of risk management. 6. Describe
the difference(s) between the three levels of
risk management. 7. Define the terms Hazard
and Risk and explain the difference. 8.
Define the terms gambling and risk management
and explain the difference
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Causes of Risk
Risk Management

• Change - the mother of risk
• Resource constraints
• New technology
• Complexity
• Stress
• Environmental influences
• Human nature
• OPTEMPO

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RISK MANAGEMENT FAILURE EXAMPLE
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Hellfire Missile Launch
Saudi Arabia
21 November 1990
A Potential War Stopper
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Apache on the flight line fully armed,
undergoing preparation for phase maintenance.
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THE RISK MANAGEMENT PROCESS
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RISK MANAGEMENT FAILURES
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Risk Management Failures
FAILED TO IDENTIFY HAZARDS
Fully uploaded aircraft without revetments.
Aircraft pointed at each other across an active
runway.
Aircraft armament systems pointed at maintenance
and billeting facilities and ammo supply point.
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Risk Management Failures
FAILED TO ASSESS HAZARDS
Focused on the mission. Allowed mission and
operational considerations to mask all other
issues .
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Risk Management Failures
FAILED TO MAKE A RISK DECISION
Gambled that nothing would happen.
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Risk Management Failures
NO CONTROLS IMPLEMENTED
No SOP established for the area. The unit had
been there for more than 90 days and had not
developed an SOP . Each unit operated
autonomously.
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Risk Management Failures
NO SUPERVISION
Leaders allowed subordinates to take the easy
path rather than the by-the-book method
under the guise of operational necessity.
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Risk Management Failures
THE COST
Total destruction of the Ammo Supply Point. 40
Million dollars of ordnance destroyed. Soldiers
lives placed in danger.
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THE RISK MANAGEMENT PROCESS, WHEN NOT APPLIED,
COSTS LIVES, EQUIPMENT AND PROPERTY
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SUMMARY
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Risk Assessment - The process of detecting
hazards and systematically assessing their
overall risk.
RISK - An expression of possible loss over a
specific period of time or number of operational
cycles.
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Risk Management
Four Rules of Safety Risk Management

• Manage risk in the concept and planning
  stages of operations
• Accept no unnecessary risk
• Make risk decisions at the right level
• Accept risks when benefits outweigh costs

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THE RISK MANAGEMENT PROCESS SAVES LIVES,
EQUIPMENT AND PROPERTY
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QUESTIONS