Risk Management

RISK RISK = the probability and severity of loss linked to hazards. RISK = the probability and severity of loss linked to hazards. The probability of an undesirable outcome. The probability of an undesirable outcome.

HAZARD = a condition that exists with the potential to cause injury, illness, or death of personnel; damage to or loss of equipment or property; or mission degradation. HAZARD

RISK ASSESSMENT = the identification and assessment of hazards. RISK ASSESSMENT

RISK MANAGEMENT RISK MANAGEMENT = A decision making process that uses risk analysis tools to make risk informed decisions for the complex choices we face. It’s making decisions that balance risk exposure with mission benefits. RISK MANAGEMENT = A decision making process that uses risk analysis tools to make risk informed decisions for the complex choices we face. It’s making decisions that balance risk exposure with mission benefits.

RISK vs GAIN or BENEFIT The amount of risk of an action weighed against the potential benefit.

Risk Decision The decision to accept, reject, or transfer the risk(s) associated with an action.

Three Levels of Risk Management 1.Strategic 2. Deliberate 3. Time Critical

Strategic  Done at 30,000 foot level  Identifies values at risk  Identifies Course of Action alternatives  Evaluates exposure, cost, and other factors among different alternatives  Course of Action chosen by agency administrator

SRA Template 1.Risk Assessment  Values at Risk  Probability of value being harmed  Consequences of harm  Potential benefits 2. Risk Analysis  Comparison of Alternatives – exposure, cost 3. Risk Communication  Who are the stakeholders?  Who needs to know? 4. Risk Sharing  Engage internally and externally as appropriate  Share vertically and horizontally throughout the organization  Obtain understanding, acceptance, and support for the range of alternatives and likely decision

5. Risk Decision  Document risk decision  Explain rationale 6. Risk Monitoring  Revise as necessary due to changing conditions

Strategy Full-perimeter containment using indirect line. Total Prospect Area (acres)52, 200 Prospect perimeter (chains)3,360 chains Planned Contingency Line (chains) None – full perimeter containment Estimated Incident Responder Exposure (person hours) 377,202 person hours Estimated Cost$22.0 million StrategyPoint protection and check lines. Total Prospect Area (acres)17, 500 Prospect Containment Line Completed (chains) 264 Planned Contingency Line (chains) 160 chains (estimate) Estimated Incident Responder Exposure (person hours) 72,964 person hours Estimated Cost$ 3.9 million

Prospect #1 Perimeter Control, Contingency Checking and Monitoring Prospect #2 Full Perimeter Control Total Prospect Area (acres) 2,600 (estimated) 2,000 (estimated) Prospect Containment Line (chains) NA 600 Estimated Contingency Line (chains) 300 NA Estimated Incident Responder Exposure (person hours) 47,436 person hours 96,348 person hours Estimated Cost$ 2,283,260$ 5,203,086

Deliberate  A multi-step, analytical, sequential process  Linkage with strategic level - analysis of missions that come from the strategic risk assessment’s incident objectives  Generally will be performed at the IMT level as part of the planning process

THE SEVEN STEP PROCESS THE SEVEN STEP PROCESS

Risk Management Process Define the level of risk Define the level of probability Define the level of severity Is the risk level acceptable? Can the risk be eliminated? Can the risk be mitigated? Can the residual risk be accepted? (if any) Take action and continue the operation An action is being considered Identify hazards/consequences and assess risks NONO NONO NONO Cancel the operation YES Take action and continue the operation YES Take action and continue the operation YES Feedback and record the hazard identification and assessment and risk mitigation Feedback and record the hazard identification and assessment and risk mitigation ICAO Safety Management Systems (SMS) Course

THE SEVEN STEP PROCESS THE SEVEN STEP PROCESS

Risk Management 215A

ASSESS RISKS SEVERITY - What are the effects? PROBABILITY - Can this happen to us? EXPOSURE - What is the event frequency or degree of involvement?

Severity NegligibleMarginalCriticalCatastrophic Frequent HIGH Probable Occasional MEDIUM Remote Improbable LOW Likelihood/Probability Severity

Defining Probability and Severity Levels Severity Scale Definitions CatastrophicResults in fatality/fatalities and/or loss of the system. CriticalSevere injury and/or major system damage. MarginalMinor injury and/or minor system damage. NegligibleLess than minor injury/or less than minor system damage. Likelihood/Probability Scale Definitions Frequent Individual All Resources Likely to occur often. Continuously experienced. Probable Individual All Resources Will occur several times. Will occur often. Occasional Individual All Resources Likely to occur sometime. Will occur several times. Remote Individual All Resources Unlikely to occur, but possible. Unlikely but can reasonably be expected to occur. Improbable Individual All Resources So unlikely, it can be assumed it will not occur. Unlikely to occur, but possible.

Residual Risk The level of risk remaining after controls have been identified and selected.

Time Critical  Risk assessments done “on the fly” by firefighters at the ground level.  Deference to expertise.  Make risk decisions at the appropriate level.  Doctrinal approach.

Strategic Deliberate Time Critical Data Time Decision Space

STOP!

Intolerable region Tolerable region Acceptable region The risk is unacceptable under most conditions The risk is acceptable based on mitigation The risk is acceptable as it currently stands

Risk management is more than just an analytical process, it is a different way of communicating.

Risk Management Framework 1.Risk Assessment 2.Risk Analysis 3.Risk Communication 4.Risk Sharing 5.Risk Decision 6.Risk Monitoring

Questions?