Perspectives in Risk Management: Current Theory and Practice in Safety Risk Management
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1 Perspectives in Risk Management: Current Theory and Practice in Safety Risk Management Jacobs Australia Safety Seminar Hong Kong 18 and 19 th July 2006 Presenter: Matthew Squair
2 Outline Background Introduction Characteristics of Technological Risk Safety Management Theories Risk and Uncertainty Communicating Risk Arguing Safety Risk Acceptance Consequence Management Additional Reading 2
3 Background Changing management of safety risk Traditionally compliance with the regulation Now may be required to present a safety case Key management challenges Establishing a safety management system Encouraging and sustaining a safety culture Managing conflict between safety and the organisations primary production goal How can we safely operate systems at the limit of their performance envelope? A core concept is risk but how is it measured? 3
4 Introduction Review current theories and best practice Discuss some issues normally glossed over Provide perspectives and concepts for management The concepts discussed can be applied generally as well as to specific high consequence tasks A basic familiarity with the concepts of risk management is assumed 4
5 Characteristics of Technological Risk What is risk? De Moivre s theorem of 1711 A trans-scientific issue Is technological risk increasing? How do we decide acceptable risk Cost/Benefit analysis? Should we place a value on human life Why? Absolute or relative? Role of standards/regulation? Complex social relationships 5
6 Characteristics of Technological Risk (contd) Government Risk Acceptance Real Risks Public Deploy Regulate Retire Recommendations TECHNOLOGY SAFETY RISK Risk Perception Influence Risk Assessment Media Professionals/ Experts Risk Communication Risk Communication 6
7 Safety Management Theories Three theories currently dominate Normal Accident Theory (NAT) Reasons model of human error (Reason) High Reliability Organisations (HRO) 30-20% Technical NAT Safety Management System (SMS) Accident Cause 70-80% Human Factors NAT/HRO / Reason Human Error Reason Safety Culture HRO / Reason HRO / Reason Safety Climate 7
8 Safety Management Theories Charles Perrow s Normal Accident Theory (NAT) Developed in the aftermath of Three Mile Island Catastrophic accidents are inevitable in complex, tightly coupled, technological systems Law of inadvertent consequences Focus on interaction and system effects Adding redundancy (people/equipment) to a system Adds complexity and inadvertent interactions Common mode failures Social effects The take home Favour simple linear designs over complex coupled designs Avoid over reliance on redundancy (N 4) For critical systems actively look for common causes Where redundancy is used justify it s independence 8
9 Safety Management Theories James Reason s Model of Human Error (The Swiss Cheese Model) Swiss cheese model of accidents Accident occurs due to unsafe acts + latent conditions Latent conditions = design, supervision or culture Sources of unsafe acts (errors vs violations) A taxonomy of errors (skill, rule or knowledge error types) Two approaches to managing error Person based Just world syndrome or name and blame System based A human error risk management system The take home Use the system approach to evaluate your safety culture Middle management enforcement of safety procedures Manage human error by reducing latent conditions Use taxonomy to error proof designs and procedures 9
10 Safety Management Theories La Porte s High Reliability Organisations (HRO) Properly designed, organisations can manage high risk USN reactors 5,000 reactor years, no major accidents Same issues are identified in many accident reports Is there a set of organisational attributes that ensure safety? HRO s exhibit institutional constancy, demonstrated by Trustworthiness Safety is formal, open and a cultural norm Capability to perform Resources and technical ability Hierarchical but flexible structures able to handle crises Institutionalised chronic unease The take home Use as a template for organisational transformation Feedback and feed in of safety data is an essential capability A HRO can manage safety risk at the edge of performance giving greater return on investment with lower risk 10
11 Risk and Uncertainty Types of risk Can we quantify probability and severity? Uncertainty of the probability estimate (Rasmussen) Accident rates credible only to a factor of ten Very rare events credible only to a factor of one hundred Risk perception Is affected by personal biases (availability, responsibility) Dread/unknown factors affect laypersons risk perception Significant difference in expert and layperson perceptions The take home Risk assessment is a bounded rational process Ensure that the inherent uncertainty is recognised within the decision-making process Require a sensitivity analysis where there is uncertainty 11
12 Communicating Risk Risk communication multiple levels and stakeholders Communication = A two way exchange of information Often conducted in high risk but low trust environments Beware of the deficit model trap The golden rules 1. THE PUBLIC IS A PARTNER 2. PLAN AND EVALUATE 3. SHOW YOU CARE 4. NEVER EVER LIE 5. CONFLICT REDUCES CREDIBILITY 6. MEET THE MEDIAS NEEDS 7. SPEAK CLEARLY AND WITH COMPASSION 8. RISK COMPARISON EFFECTIVENESS 9. NO MORE THAN 27 WORDS, 9 SECONDS AND 3 MESSAGES (MENTAL NOISE) The take home People want to know you care before they care what you know The top three weighting factors are trust, control and fairness The objective is ethical communication not spin Non verbal communication is vital 12
13 Arguing Safety Sometimes termed a safety case Provide an overall assessment of operating risk Evolves across the project lifecycle What you achieved not how hard you tried Shows an SMS is in place, operating, effective and enforced A statement by the principal for safety accepting the risk May be required by a regulator Provides assurance that the SMS exists and works Is a living document just as the SMS is a living system The take home There are legal, ethical and practical reasons for safety cases If presented with a safety case critically review it Is an antidote to organisational change (the Clapham effect) SMS = Safety Management System 13
14 Risk Acceptance An act of risk assessment and management Consider Who benefits?, Who carries the risk?, Who has the ability to carry? What is the compensation? Have they consented? Is acceptance criteria consistent with the development criteria? Do we tolerate a risk or accept it? Decision criteria ALARP, ALARA, MEM, GAMAB, dollar value, regulation The take home Risk acceptance/tolerance is based on value judgements The level of sign-off should be proportional to risk Setting acceptance criteria is one of the hardest parts of risk management 14
15 Consequence Management By reducing the severity of accidents risk is reduced Requires equipment and people that are ready Also addresses unidentified hazards Traditional problem areas Personnel psychological and physical suitability Communication breakdown both internal and external Pathological group and individual behaviour Performance shaping factors (fear, uncertainty, fatigue) When an accident occurs Acknowledge responsibility and apologise Convince victims that lessons learned will reduce chance of recurrence Over communicate The take home Screen and over-train personnel who have key safety roles Plan for a broken back phase in any accident response Enforce a stop and inspect culture 15
16 Additional Reading 1. Reason, J. (1990): Human Error, Cambridge University Press. 2. Reason, J. (1997): Organisational Accidents: The Management of Human and Organisational Factors in Hazardous Technologies, London: Ashgate. 3. La Porte, T., Rochlin, G. (1994): A rejoinder to Perrow Journal of Contingencies and Crisis Management, 2(4), pp Perrow, C. (1984): Normal Accidents: Living with High-Risk Technologies. 5. Rasmussen, N. (1975): The Reactor Safety Study: An Assessment of Accident Risks in US Commercial Power Plants, Report WASH-1400, NUREG-75/014, NRC Washington, DC. 16
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