Risk Management RISK MANAGEMENT RM95 2 Risk Management

Risk Management RISK MANAGEMENT RM-95 -2

Risk Management Wartime Accident Losses “Accidents, which are usually preventable, reduce your ability to complete the mission. ” RM-95 -3

Risk Management Battle and Non-Battle Losses* in Theater -Historical Perspective. World War II 1942 -45 Korea 1950 -53 Vietnam 1965 -72 DS/DS 1990 -91 Accident (1, 007, 704) 56% 44% (77, 108) 54% (270, 608) 75% (1, 406) Friendly Fire 1%** (15, 839) 1%** (1, 943) 1%** (4, 678) 5% (86) Enemy Action 43% (776, 105) 55% (97, 198) 45% (229, 239) 20% (366) ARMY *Deaths and injuries (ground aviation) **Research-based estimate(2% of all direct- and in-direct fire losses) RM-95 -4

Risk Management l. Risk Management Concept. Risk management is a systems based concept. It is the application of systemic thinking to the problems associated with making military operations safer and more effective. u RM-95 -5

Risk Management l Risk Management Concept. The concept was originally developed to improve safety in the development of weapons, aircraft, space vehicles, and nuclear power. Risk management concepts were found to be especially effective in dealing with high-risk complex activities. This has led to the application of safety risk management concepts in tactical training scenarios. u RM-95 -6

Risk Management l The Risk Management concept. u Risk management is not a science, it doesn’t provide leaders with a precise course of action. Neither is it just “common sense” or “something good leaders have always done. ” It is an important tool that can be fully integrated into established Army systems for conduct of training and combat. It is more an art than science, but an art based on systematic procedures and specific techniques. RM-95 -7

Risk Management Risk management concepts are not confined to systems development or tactical operations. They have been applied successfully to other areas of Army operations: u Physical Security (AR 190 -51) u Intelligence (AR 380 -19) l Tactical Doctrine (FM 100 -5) l Finance l Safety (AR 385 -10). l RM-95 -8

Risk Management How much of a problem a hazard presents can’t be determined until the hazard is converted to a risk. u When the hazard is expressed in terms of how likely it is to occur, and how serious the consequences are if it does occur. . . then the commander can make rational decisions about how to deal with that hazard. u RM-95 -9

Risk Management Army operations require risk management to be very flexible. u Leaders must often make tough, complex decisions in a matter of minutes or seconds. risk management must be compressible and adaptable to these time constraints or be left out. u RM-95 -10

Risk Management On the other hand, many times we have weeks or months available for planning an operation. The level of detail that goes into the process depends on the time available and the extent of the risk. u RM-95 -11

Risk Management Gambling vs. Risk Management. u l l Bold, aggressive risk takers are needed, admired, and endorsed in the Army. Some people admire and endorse gamblers as bold risk takers. Gamblers, if they are successful, are hard to separate from the bold risk taker who uses the risk management process to detect and control hazards. But sooner or later the gambler loses. RM-95 -12

Risk Management Gambling vs. Risk Management. u l l The key difference between the gambler and the bold risk taker is that the risk managing leader can reasonably predict the outcome. The gambler is only guessing. RM-95 -13

Risk Management vs. Gambling So what is the difference between gambling and managing risk? The result? The decision? The process? RM-95 -14

Risk Management vs. Gambling The result? No! The decision? No! The process? Yes! A gambler will perform an operation without regard to the risk. The risk manager weighs the risk with the mission/ training benefits and makes a good risk decision. He will also put controls on the risks and make the soldiers involved in the operation aware of the risks and his controls. RM-95 -15

Risk Management FM 100 -5, Operations “Safety is part of all combat operations and operations other than war. Commanders at all levels should embrace safety as a principal element in all they do. Sustained, high-tempo operations can put soldiers at risk. Strong command high levels of discipline and training lessen those risks. Safe procedures represent a skill - a product of enforced standards and training. Safety in training, planning, and operations is crucial to successful combat operation and the preservation of combat power. ” RM-95 -16

Risk Management l Elements of combat power. Maneuver. u Firepower. u NOTE: Maneuver and Firepower are significant contributors to risk. Commanders seek to stretch these elements to the limit to gain an advantage over the enemy and thus incur increased risk. Effective risk management will eliminate risk when possible, control residual risk, and allow the command to accept risk when the benefit outweighs the cost. Leadership. u Protection. u RM-95 -17

Risk Management Protection. u l l Protection conserves the fighting potential of a force so commanders can apply it at the decisive time and place. In addition to safety, protection includes tactical survivability, industrial hygiene, environmental protection, occupational health, and fratricide prevention. Although safety responsibilities overlap the other elements of protection, safety is the largest part of protection. RM-95 -18

Risk Management FM 101 -5 Staff Organization and Operations “When safety is integral to battlefocused training as Force Protection, safe procedures in combat are a natural consequence. ” RM-95 -19

Risk Management Society's acceptance, and components of risk. RM-95 -20

Risk Management Realistic Training -vs- Safe Training u l l "Train like we will fight" -vs- "Safety is paramount". “Push your troops to the limit” -vs- “We will have no accidents” Training as we will fight may not always be practical because the risk can outweigh the benefit. u RM-95 -21

Risk Management Voluntary Activities l Accept almost any risk short of suicide. l Involuntary Activities l Acceptable threshold 1 in 10, 000. l Ultralights l Bungee jumping l Mountain climbing l l 1 in 30 AAR Aviation test pilot 1 in 300 AAR British fisherman 1 in 500 AAR Army aviator 1 in 1000 AAR miner l Average person will accept roughly 1, 000 times as much risk voluntarily as he will involuntarily –Loss of life - Various risks. 1 in 2000 AAR Soldier l 1 in 6500 AAR American motorist l 1 in 8000 AAR JQ citizen l AAR - Average annual risk of death RM-95 -22

Risk Management l Risk - Chance of hazard or bad consequences; exposure to chance of injury or loss. Risk level is expressed in terms of hazard probability and severity: l Exposure - The frequency and length of time subjected to a hazard. u u Severity - The expected consequence of an event in terms of degree of injury, property damage, or other mission impairing factors (loss of combat power, adverse publicity, etc. ) that could occur. Probability - The likelihood that an event will occur. RM-95 -23

Risk Management Fundamental precepts. u The greater the risk the more senior the final decision maker should be. l When in the high-risk zone, everyone from the commander to the individual must be aware of the risk implication. l All risk variations that can be controlled, must be controlled. l By-the-book disciplined operations are mandatory. l RM-95 -24

Risk Management l Key Definitions. Risk Management - A process of identifying and controlling hazards to protect the force. u Hazard -Any real or potential condition that can cause injury, illness, or death of personnel, or damage to or loss of equipment or property u RM-95 -25

Risk Management Risk -Chance of hazard or bad u consequences; exposure to chance of injury or loss. Risk level is expressed in terms of hazard probability and severity: Risk Assessment -The first two steps of the risk management process. u Gambling - Making non-systematic risk decisions. u RM-95 -26

Risk Management Process Assess hazards Identify hazards Supervise & evaluate Make decisions Implement controls RM-95 -27

Risk Management Process Assess hazards Identify hazards Supervise & evaluate Make decisions Implement controls RM-95 -28

Risk Management Process Assess hazards Identify hazards Supervise & evaluate l Identify Hazards. Identify hazards to the protect force. Consider all aspects of current and future situations, environment, and known historical problem areas. l Assess Hazards l Develop Controls l Implement Controls l Supervise & Evaluate Make decisions Implement controls RM-95 -29

Risk Management Process. Assess hazards Identify hazards Supervise & evaluate l Identify Hazards l Assess Hazards. Assess hazards to determine risks. Assess the impact of each hazard in terms of potential loss and cost, based on probability and severity. l Develop Controls l Implement Controls l Supervise & Evaluate Make decisions Implement controls RM-95 -30

Risk Management Process. Assess hazards Identify hazards Supervise & evaluate l Identify Hazards l Assess Hazards l Develop Controls and Make Risk Decisions. Develop control measures that eliminate the hazard or reduce its risk. As control measures are developed, risks are reevaluated until all risks are reduced to a level where benefits outweigh potential cost. l Implement Controls Make decisions Implement controls RM-95 -31

Risk Management Process. Assess hazards Identify hazards l Identify Hazards l Assess Hazards l Develop Controls l Implement Controls. Put controls in place that eliminate the hazards or reduce their risks. Make decisions u Supervise & evaluate Implement controls Examples: l l Plans, Operations Orders (OPORDs), Standing Operating Procedures (SOPs), Training Performance Standards, Rehearsals. Supervise & Evaluate RM-95 -32

Risk Management Process. Assess hazards Identify hazards Supervise & evaluate Make decisions Implement controls l Identify Hazards l Assess Hazards l Develop Controls l Implement Controls l Supervise & Evaluate. Enforce standards and controls. Evaluate the effectiveness of controls and adjust/update as necessary. RM-95 -33

Risk Management l Four Key Points of Risk Management Integrate risk management into planning. u Accept no unnecessary risks. u Make risk decisions at the proper level. u Accept risks if the benefit outweighs the cost. u RM-95 -34

Risk Management l Four Key Points of Risk Management. Integrate risk management into planning. It’s easier to integrate risk management early in the life cycle of any operation (training or combat). u RM-95 -35

Risk Management l Four Key Points of Risk Management. Accept no unnecessary risks. The key word is “unnecessary”. An unnecessary risk is a risk that does not contribute meaningfully to the mission. Leaders who take unnecessary risks are gambling. u RM-95 -36

Risk Management l Four Key Points of Risk Management. Make risk decisions at the proper level. The “ proper level” is the level where the decision maker has the maturity and experience to make a good decision. Normally, this would be the leader responsible for the mission. Decisions should be made at the lowest possible level as long as the decision maker has the experience and maturity to make a good decision. u RM-95 -37

Risk Management l Four Key Points of Risk Management. Accept risks if the benefit outweighs the cost. Army leaders are in the risk-taking business. There is always risk, and where there is risk, sooner or later there will be an accident, risk management minimizes these accidents. u RM-95 -38

Risk Management l Hazard Probability of a Risk. u A risk assessment matrix is an effective tool that can be used to determine how risky an identified hazard is. Standard terms associated with risk assessment matrices include: u Probability - The likelihood that an event will occur. u Severity - The expected consequence of an event in terms of degree of injury, property damage, or other mission impairing factor that could occur. RM-95 -39

Risk Management Risk Assessment Matrix HAZARD PROBABILITY S E V E R I T Y Catastrophic I Critical II Moderate III Negligible IV Frequent Likely Occasional Seldom Unlikely A B C D E Extremely High Medium Low RM-95 -40

Risk Management HAZARD PROBABILITY Frequent Likely A B Occasional C Seldom D Unlikely E l Frequent Individual item. Occurs often in the life of the system. u Fleet or inventory. Continuously experienced. u Individual soldier. Occurs often in career. u All soldiers exposed. Continuously experienced. u RM-95 -41

Risk Management HAZARD PROBABILITY Frequent Likely A B Occasional C Seldom Unlikely D E l Likely u u Individual item. Occurs several times in the life of the system. Fleet or inventory. Occurs frequently. Individual soldier. Occurs several times in career. All soldiers exposed. Occurs frequently. RM-95 -42

Risk Management HAZARD PROBABILITY Frequent Likely A B Occasional C Seldom D Unlikely E l Occasional u u Individual item. Will occur in the life of the system. Fleet or inventory. Occurs several times in the life of the system. u Individual soldier. Will occur in career. u All soldiers exposed. Occurs sporadically. RM-95 -43

Risk Management HAZARD PROBABILITY Frequent Likely A B Occasional C Seldom D Unlikely E l Seldom Individual item. Unlikely but could occur in the life of the system. u Fleet or inventory. Unlikely but can be expected to occur in the life of the system. u Individual soldier. Unlikely but could occur in career. u All soldiers exposed. Occurs seldom. u RM-95 -44

Risk Management HAZARD PROBABILITY Frequent Likely A B Occasional C Seldom D Unlikely E l Unlikely Individual item. So unlikely you can assume it will not occur in the life of the system. u Fleet or inventory. Unlikely but could occur in the life of the system. u Individual soldier. So unlikely you can assume it will not occur in a career. u All soldiers exposed. Occurs very rarely. u RM-95 -45

Risk Management I Catastrophic - Death or permanent total disability, system loss, major property damage. II Critical - Permanent partial disability, temporary total disability in excess of 3 months, major system damage, significant property damage. Moderate III Moderate - Minor injury, lost workday accident, compensible injury or illness, minor system damage, minor property damage. Negligible IV Catastrophic S E V E R I T Y Critical Negligible - First aid or minor supportive medical treatment, minor system impairment. RM-95 -46

Risk Management Risk Levels Extremely High Moderate Low Extremely High - Loss of ability to accomplish mission. High - Significantly degrades mission capability in terms of required mission standards. Moderate - Degrades mission capabilities in terms of required mission. Low - Little or no impact on mission accomplishment. RM-95 -47

Risk Management l. Applying Risk Management to the military operations. Task, Condition and Standards. u Troop Leading procedures. u Decision Making Process. u RM-95 -48

Risk Management l Applying RM to Army Operations Identify Hazards u Assess Hazards u Develop Controls & Make Risk Decisions u Implement Controls u Supervise and Evaluate u Hazard factors (METT-T) l. Mission. l. Enemy. l. Terrain. l. Training of personnel. l. Time of day. l. Equipment. l. Weather. l. Other specific hazards/guidance. l RM-95 -49

Risk Management Integration of RM into Troop Leading Procedures. Mission Risk Management 1. Identify Hazards Troop Leading Procedures 1. Receive mission (Initial METT-T analysis) 2. Issue Warning Order 3. Make a tenative plan a. Estimate of the situation 1. Detailed Mission anaysis 2. Develop situation & courses of action Enemy situation Terrain & weather 2. Assess Hazards Friendly situation (Troops & Time) Courses of action (friendly) 3. Analyze courses of action- wargame 4. Initiate movement 5. decision b. Expand selected COA into tenative plan 3. Develop Controls & Make Decision 4. Implement Controls 5. Supervise & Evaluate 4. 5. 6. 7. 8. Initiate Movement Reconnoiter Complete the plan Issue the order Supervise & refine the plan RM-95 -50

Risk Management Integration of RM into Decision Making Process Mission Risk Management 1. Identify Hazards - Gather & analyze METT-T facts to identify hazards most likely to result in loss of combat power 2. Assess Hazards A. Complete risk assessment for each course of action (COA) B. Enter risk level of each COA as a decision criteria. 3. Develop controls & make risk decisions A. Identify, develop & select controls for hazards most likely to result in loss of combat power B. Make risk decision for selected COA accept residual risk level or elevate decision Decision Making Process 1. Receive mission 2. Gather and consider information 3. Complete mission analysis, restate mission and issue planning guidance 4. Complete staff estimates A. Develop/analyze /compare COAs (wargame) B. Recommend COA 5. Complete commander’s estimate A. Analysis of COAs (wargame) B. Decision (select COA) C. Concept of operation (Select controls and make risk decision) 4. Implement controls - Coordinate & Communicate controls - integrate into paragraphs and graphics of OPORD 6. Prepare 5. Supervise - Monitor & enforce controls. Evaluate & revise as necessary 9. Supervise 7. Approve 8. Issue Plans/Orders RM-95 -51

Risk Management l Applying Risk Management to the Decision Making process. u Deliberate Decision-Making. Application of the RM process using worksheets and RM tools - operations analysis (OA), preliminary hazard assessment (PHA), risk control options, training realism assessment (TRA), implementation procedures, and sustained monitoring. RM-95 -52

Risk Management l. Applying Risk Management to the Decision Making process. Combat Decision-Making u Application of the RM process by the leader/commander and staff when time is constrained. Identifies risks associated with specific COA and appropriate controls. RM-95 -53

Risk Management l. Applying Risk Management to the Decision Making process. Quick decision-making u A quick, often mental, application of the RM process by the leader faced with unforseen, imminent crisis or emergency situation. RM-95 -54

Risk Management l. Hazard Detection Resources. Experience. u. Experts. u. Regulations and Manuals. u. Accident Data. u. Scenario Thinking. u. Hazard Analysis Techniques. u RM-95 -55

Risk Management l. Hazard Detection Resources. Experience. Traditional “risk management” is based on experience. Since no two individuals share exactly the same experiences the best way to use “experience” is to get more people involved, brainstorm. u RM-95 -56

Risk Management l. Hazard Detection Resources. Experts. Consult with acknowledged experts, instructor pilots, safety officers, maintenance officers/technical inspectors, etc. u RM-95 -57

Risk Management l. Hazard Detection Resources Regulations and Manuals Properly developed regulations incorporate lessons learned, input from subject matter experts, as well as command directives. u RM-95 -58

Risk Management l. Hazard Detection Resources. Accident Data. The USASC database contains information of more than 250, 000 accidents. u RM-95 -59

Risk Management l. Hazard Detection Resources. Scenario Thinking. Scenario thinking involves visualizing the flow of an operation, the events that take place, and the things that can go wrong. u RM-95 -60

Risk Management l. Hazard Detection Resources. Hazard Analysis Techniques. These techniques provide systematic tools for identification of hazards in an operation (cause and effect diagramming, mathematical modeling). u RM-95 -61

Risk Management HAZARD ID TOOLBOX RM-95 -62

Risk Management l. Conduct a Risk Management PE Use the scenario, “Reducing the risk in training-Nobody’s fault”, TVT 20 -932. u Read the scenario provided. u Identify the hazards, complete a hazard assessment, and develop controls for the hazards u RM-95 -63

Risk Management Hazards l Non/weak swimmers l Stream current l Stream width l Stream depth l Debris l Fatigue l Water temperature l Equipment weight l Weapons security RM-95 -64

Risk Management Hazard Risk l Non/weak swimmers High/EH l Stream current Medium l Stream width Low l Stream depth High l Debris Low l Fatigue Low l Water temperature Low l Equipment weight High l Weapons security Low RM-95 -65

Risk Management Hazard Controls l Non/weak swimmers Eliminate l Stream current Recon crossing l Stream width 1 rope crossing l Stream depth Strong swimmer 1 st l Debris Face up-stream l Fatigue l Water temperature l Equipment weight Rucksack on rope l Weapons security “Dummy” cord RM-95 -66

Risk Management l Applying Risk Management Identify Hazards u l Conduct an operational analysis. An operational analysis is a description, normally in time sequence, of the events that are expected to occur during the operation. Break the operation down into sub-elements. RM-95 -67

Risk Management Identify Hazards u l Complete a preliminary hazard analysis (PHA). List the various hazards that could result in accidents. It is developed using experience, brainstorming, databases, and scenario thinking. l If necessary, and time permits, conduct a more in-depth hazard analysis. RM-95 -68

Risk Management Assess Hazards u l l Assess all hazards based on probability, severity, and mission impact. Hazard Identification and hazard assessment combine to form a risk assessment. Risk Identify Hazards Assessment Assess Hazards Develop Controls & Make Risk Decisions Implement Controls Supervise and Evaluate RM-95 -69

Risk Management Develop Controls & Make Risk Decisions u l Develop risk control options starting with the most serious risks. Use the risk control option matrix in the Risk Management Reference Guide and Course Book (staff) RM-95 -70

Risk Management Develop Controls & Make Risk Decisions u l Complete a Training Realism Assessment (TRA). The TRA is designed to assure that the risk control options selected have the maximum battle focus and least possible adverse impact on realism. (staff) RM-95 -71

Risk Management Develop Controls & Make Risk Decisions u l Complete an opportunity assessment. Use a training realism assessment to detect opportunity to improve realism in training. RM-95 -72

Risk Management Develop Controls & Make Risk Decisions l Make a risk decision by selecting controls that will reduce the risk to a minimum consistent with the mission. (commander) l Consideration is given to realism, time, money, or other resources. u RM-95 -73

Risk Management Risk Decision -make the risk decision at the proper level. MISSION COMPLEXITY Brigade R I S K Extremely High Battalion Company Platoon Squad Division High Brigade Moderate Battalion Company Low RM-95 -74

Risk Management Implement controls u Standing Operating Procedures (SOP'S). l Orders. l Supervision. l Training. l New equipment. l RM-95 -75

Risk Management Supervise and Evaluate u Maintain the effectiveness of risk controls. l Assure that risk control measures are performing as expected. l Re-evaluate risk control measures to ensure they are l RM-95 -76

Risk Management l. Conduct a Risk Management PE Apply the Risk Management process to a one and two man aerial extraction mission. u Work as a group to complete all tasks identified on handout. u RM-95 -77

Risk Management l. Applying Risk Management in deliberate decision making Extensive coordination between subject matter experts and technical experts may be required. u More complex analysis, logic diagram, fault tree, and training realism assessments etc. , may be used. u RM-95 -78

Risk Management in deliberate decision making Test in similar or smaller scale. u Higher level, more formal risk decision procedures. u More coverage of the operational life cycle. u RM-95 -79

Risk Management l Steps to incorporate RM into combat decision making. Apply the RM process: u l l To hazards not identified during the deliberate decision-making phase. To complete a change analysis for mission elements that are different than originally planned RM-95 -80

Risk Management l Levels and responsibilities of safety. Command level u l Plan for safety. l Set safety standard. l l l Conduct training consistent with abilities of trainers. Resource safety. Make risk acceptance decisions when you can't eliminate the risk. RM-95 -81

Risk Management l Levels and responsibilities of safety. Leader level u l l l Emphasize adherence to standards and accident prevention. Assess and balance risk against training or operational requirements. Recognize then eliminate or control, health and safety hazards. RM-95 -82

Risk Management l Levels and responsibilities of safety. Individual level u l Understand individual safety responsibilities. l Recognize unsafe acts and conditions. l Perform to standards. RM-95 -83