A new way of looking at risk

by Alex on October 29, 2014

In the health and safety field we tend have a pretty limited view of risk. We think of risk as the danger that something will go wrong or break, or that someone will be injured. If it’s a business risk, we think of it as the potential that we’re going to lose money on an investment or that a company will underperform. But there’s a lot more to risk than that.

Risk as Uncertainty

In ISO 31000:2009, a collection of standards related to risk management, risk is defined as “the effect of uncertainty on objectives.” It’s easy to see how this conceptualization of risk takes in a much wider variety of situations than simply defining it as the danger of something going wrong. Interestingly, looking at risk as uncertainty related to objectives means that risk can even be seen as a positive thing, which is a way of thinking that few people are used to.

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By thinking about risk in the way that the ISO does, you can get a more comprehensive view of the amount of risk that’s being undertaken on your job site or throughout your company and how to deal with it. And one of the best ways to really get into a new, more effective mindset surrounding risk is to take a look at the seven ways that the ISO lists to deal with it.

1. Avoid Risk

The first strategy listed by the ISO is “Avoiding the risk by deciding not to start or continue with the activity that gives rise to the risk.” This is a very common one, especially when it comes to the risk of physical harm to employees. Identifying risky situations is an important part of this strategy. If you know, for example, that falls account for more serious injuries in construction than anything else, and that roofers account for 24% of workers killed by falls, you’re more likely to take action to avoid risks related to working at height.

So when a worker is in an especially risky situation—like working on a roof in the rain—it often makes the most sense to just stop taking part in that particular activity. In this example, the work could be resumed after the risk has been lowered (when the weather improves). By simply removing workers from risky situations, you can significantly decrease the chances of something bad happening.

2. Accept Risk

Strategy #2, “Accepting or increasing the risk in order to pursue an opportunity,” is an interesting one. There are very few times when it’s recommendable to actually increase the risk that you’re taking. However, when thinking about risk on the scale at which the ISO is addressing it, this is sometimes a smart decision.

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Let’s take a look at the example of lone working—it’s inherently dangerous, but sometimes it needs to be done. There’s a certain amount of risk that needs to be accepted in these cases, even when proper controls have been put into place. But risk can be mitigated to an acceptable level by clearing the work with a supervisor, only allowing properly experienced workers to work alone, and having regular check-ins via mobile phone. Even with proper controls, lone working can be risky, but there are times when that risk just needs to be accepted.

3. Remove the Source

The third strategy listed by ISO, “Removing the risk source,” is one of the most common strategies. A great example of removing risk is shutting down the electrical system in a building that’s undergoing work—this method is simple, easy, and effective. Instead of a very high-risk activity, working near live electrical lines in the building is now quite low-risk. And by double-checking with a voltage-indicating device, having equipment checked by a compliant tester, and applying main earths where they’re needed, the risk can be even further reduced.

Removing the source of risk is often the easiest way to improve the likelihood of a positive outcome, whether you’re trying to make a job site safer or make sure that your company stays financially stable. And although it can be difficult to completely remove a source of risk, getting rid of even some of the risk sources for a particular activity can make a big difference.

4. Reduce the Chances

Similar to removing the risk source is risk management strategy #4, “Changing the likelihood.” In this strategy, some risk is deemed acceptable, but the current level is too high. Using the above example of a builder work on a roof in the rain, the HSE recommends strategies including minimising the potential fall distance, setting up barriers at the edge of the roof, and using nets or a fall-arrest harness system.

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As you can see in our risk matrix above, there’s a relationship between the severity of a potential injury and the likelihood of it happening that creates risk. As a more specific example, we can look at the risk of a worker or a member of the public being struck by a vehicle upon entering or exiting the site. Even though the severity remains the same, at 4, by reducing the likelihood of the event, the overall risk can be significantly reduced.

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5. Change the Stakes

This is quite an interesting strategy. ISO’s fifth method for managing risk, “Changing the consequences,” is one that is a bit counterintuitive. However, in changing the potential negative consequences for risk-taking, a great deal of risk can be mitigated. Let’s look at an electrical situation: if live electricity is a necessity at a job site, the consequences of a mistake could be fatal. There’s always a risk of a worker accidentally coming into contact with an electrical board or a live piece of equipment.

But by having a trained electrician properly fit insulation barriers and covers to those boards and equipment, the consequences become much smaller—in fact, they’re almost eliminated. These are the sorts of steps that are important to take when keeping workers safe. Unfortunately, mistakes happen. But if the proper protections are put in place, the consequences of those mistakes are significantly reduced.

6. Sharing Risk

Strategy #6, “Sharing the risk with another party or parties,” is actually closely related to the previous strategy. In this case, the risk stays the same, but the potential consequences are shared between two parties. A good example of this in the electrical field is electrical testing and commissioning. Testing and commissioning engineers often require more training than other electrical engineers, and by hiring another firm to provide them, risk is shared between the two companies.

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By hiring a contractor who specializes in an area that includes risky work, the risk remains the same, but most of it is taken on by the contractor’s employees. Of course, because it’s still your job, you retain some of the responsibility, which is why the risk is shared and not simply off-loaded.

7. Forging Ahead

The final ISO strategy is a very simple one: “Retaining the risk by informed decision.” Sometimes the risk just has to be accepted and the work has to go forward. It’s extremely difficult to reduce risk to zero, and that’s just how life is. A great example of this is working with ladders and stepladders, which can be a risk. However, the HSE states that they can be a “sensible option for low-risk, short-duration tasks.”

The law calls for a sensible, proportionate approach to managing risk, which means not carrying too much weight up the ladder, not resting the ladder on fragile surfaces, and not overreaching from the top of the ladder. Once you’ve taken the proper precautions and made sure that workers understand the best practices for their jobs, you’ll need to say that the current level of risk is acceptable and that further efforts at reducing it aren’t worth the loss in time and energy that they’ll take.

Understand Your Risk

Because the ISO is a certifying body, it pays to think about risk in the way that they suggest. Reformulating our conception of risk as something that can be positive or negative, increased or decreased, mitigated, postponed, and shared will help you form a much clearer picture of risk in your organization. And better understanding your company is always a good thing.

Image credits: ISO, Derek Gavey via flickr, Tomás Fano via flickr, Flazingo Photos via flickr.

{ 2 comments… read them below or add one }

Hans November 9, 2014 at 4:43 pm

A particularly wise comment is the final line of this article: “And better understanding your company is always a good thing.” Company culture has a lot to do with top management support for safety awareness.

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HANDSHQ.COM November 10, 2014 at 2:15 pm

Thanks HANS, safety management definitely starts at the top – a big problem is that upper management don’t always take the time to understand this

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