Management System Success is Management Success

   

 Looking for SUCCESS? In safety, or in any other area?

Interested? Go to the Succes in Safety page and have a look at PDF copies of my two books:

Risk Management, Safety and Control of Loss - Protecting Your Organization

Making Your Future - In Business and in Other Parts of Life 

 

 

 
Success in Safety Improvement Model Management System Success Improvement Process 17-Step Process Improvement Process Rating Management System Structure Management System Content Improving the Management System The Audit Management System Rating International Safety Rating System Accidents and Incidents Accident Investigation Protocol Safety Opinion Survey My books


Risk Classification

Risk classification is important as a pre-event tool to prioritize identified risks for further treatment and to obtain attention and involvement of higher management levels to develop, resource and execute actions to eliminate, reduce or control risk.

The basic questions are: how often can the unwanted event occur to trigger the sequence from hazard towards consequences and what and how large could these consequences be?

Risk classification is also an important tool as a post-event tool as part of the accident, incident and other unwanted event investigation.

The principle of dimensional value

The degree of management attention is directly related to the size of the problem

Determining the potential loss (= risk) is the objective of risk classification. The outcome of the classification process helps to determine such issues including:

  • setting priorities to deal with identified risks
  • whether a team approach should be used (highly recommended) to contribute to risk control or unwanted event investigation
  • which persons should be on the team - operational, management, staff
  • the management level of the chairperson of the team
  • selecting risk control alternatives and making resources available
  • assigning responsibilities to make sure that selected measures will be don correctly and in time

Two of the main tools to classify risks are:

  • use of a risk matrix
  • Fine/Kinney method

In principle, these methods are the same, both combining frequency of occurrence (of the accident, incident and other unwanted event preceding the loss) with the potential loss. The main difference is that the Fine/Kinney method combines an exposure factor with a likelihood factor to arrive at the frequency. So, if you want, the matrix is 2-dimensional while Fine/Kenney has 3 dimensions.

Risk Matrix

Risk Classification correlates (1) the chance of occurrence of the event ("failure rate") to (2) the possible/probably consequences.

A risk matrix could be simple form a 3 x 3 matrix (using frequency values such as: low, average, high and potential loss values such as: minor, serious, catastrophic) or be more complex such as the 5x5 matrix shown below and further explained in the accident investigation protocol.   

Risk Matrix - a 5 x 5 example

Fine / Kinney

While the matrix example in the figure above shows a 2-dimensional approach, the method originally developed in 1971 by W. Fine (later publication in 1976 by G.H.F. Kinney) is 3-dimensional. It breaks down the failure rate into two components:

  • Failure rate
    • Likelihood or probability (P) - the probability of occurrence of the unwanted event during the activity concerned
    • Exposure (E) - the frequency or duration of the activity concerned from which the unwanted event may result
  • Consequences (C) - the possible consequences of the accident, incident and other unwanted event

The three aspects P, E and C are provided with value descriptions and factors allowing a numeric risk score calculation - R = E x P x C. The Fine/Kinney method also provides a cost justification factor.

In case of considering a certain task of activity, the questions related to the failure rate would be:

  • P - what is the probability that the risk will materialize during the execution of the task or activity?
  • E - how often will the task be performed? How often does the activity take place?

See under "risk management resources" to obtain the original Fine document from NTIS.

Easy to use risk score and cost justification calculators can be obtained from SafetyRisk in Australia.  

KInney Risk Score - SafetyRisk Australia

The Fine/Kinney method has an advantage over the risk matrix as it divides the failure rate or frequency of occurrence into two factors. The Fine/Kinney method gives one more aspect to consider. Also look here for additonal information about the Fine/Kinney method.    

NEXT PAGE is Cause - Consequence Model

If you want to read my website pages from the beginning go to: THE HOME PAGE

 

 

 

  

 
View Willem Top's profile on LinkedIn  
 
Search website
 
© Copyright 2001/2012 Willem Top