THE HUMAN ERROR
IMPACT ON ACHIEVEMENT OF OBJECTIVES
SIGNIFICANT • Financial impact potential >$5m • Stakeholder faith impact is long term • Operational impact significantly challenges the organization • Significant injury and loss of life • Significant or multiple events of fine, fraud or legal action • Complete system crash with loss of critical data • Inability to recruit, retain staff to operate • Long-term labor disruption
MODERATE • Financial impact potential < $5m • Stakeholder faith impact is short term • Operational impact requires extensive management eff ort • Significant injury to one or more • Isolate incidents of a fine, fraud or legal action • System crash during a peak period • Diff iculties in recruit and retain staff • Medium-term labor disruption
MINOR • Financial impact potential < $500,000 • Short-term negative media focus and some concern raised by stakeholders
• Operational impact requires some management eff ort • Isolated injury • Civil or criminal action threatened • System off -line periodically during non-peak periods • Grievance or minor labor disruption
5 4
3 2
1 0
that could eliminate or at least alleviate the hazard and turn it in to the appropriate location. The now reported and recorded
hazard will be reviewed (hopefully by a committee) for probability and severity. Some also like to factor in frequency but I suggest that frequency be factored in the probability. Many use the low, medium and high categories for their matrix and end up with a matrix like the one shown above. Each category must have a rating that explains in detail just what each category means. Even then, there might be some things that are “subject to interpretation” and serve to help move the result into a category that favors the person(s) making the determination. The matrix on the top of page
32 was developed to help lessen the “subject to interpretation” problem. It factors in benefi t, which all risks have. For example, you are driving behind a slow-moving 18 wheeler and have been for many miles, as
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the curves in the road make passing a high risk. You are going to be late for an important event at the speed you are going. There is a straight stretch for about a mile, but you see a car at the far end. The probability of passing the truck is high as you’ve done it many times before, but the severity of a collision of two cars with a combined speed in excess of 100 mph would be catastrophic with no hope of survival. As you know that the road gets more mountainous and curvy ahead, you decide to “go for it,” feeling you can mitigate the risk by slamming on your brakes and ducking back behind the truck if your calculations are wrong. OK, that isn’t exactly how your risk calculations go, but I’d hope that you would admit that the benefi t plays a big role in the decision and if you knew that there was a passing lane a few miles ahead, your decision would likely be diff erent because the benefi t would be much less.
R 0 1 2 3 4 5 There has to be a benefi t for all the
ATING
risks we take or we wouldn’t take them. Therefore, I say factor in the benefi t and always ask yourself, “Is the benefi t really worth the risk?” If it’s not, then why are you doing it? We had a company, who, when it factored in the benefi t, sold its last Twin Otter, as the benefi t was just not worth the risk even though the probability and severity were within their established parameters. Under severity you will see that it is analyzed for not just danger to people but also to property, reputation and environment. In the matrix you select the one that has the highest number for your calculations. Using this system, you end up with a number that determines the level of risk. Each level of category must have a detailed explanation as to what constitutes that level. This helps lessen the subjectiveness to interpretation. Another infl uencer of the fi nal
number is the risk tolerance (RT) of the organization. This will vary depending on:
LIKELIHOOD OF OCCURRENCE
HIGH RISK
MEDIUM RISK
LOW RISK
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