Risk Management training

Risk management has become an integral part of almost every company's policy. It is a continuous process that identifies and assesses risks. It also determines how the probability of the occurrence and consequences of risks become manageable.

Risk Management in 6 steps

In many models, the risk management process consists of six steps:

  • Objective setting,
  • Identify risks,
  • Assess the consequences,
  • Assess risks,
  • Control risks,
  • Monitoring

Known models YES works with are HIRAM and Bowtie in combination with Threath & Error Management.

HIRAM (Hazard Identification, Risk Analysis and Mitigation) identifies hazards and analyzes and mitigates risks.

A BowTie diagram is a form of risk assessment in which potential hazards are identified. It maps the path that a potential hazard with a potentially serious outcome can follow. It also depicts the combination of preventive and mitigating barriers needed to reduce the process safety risk" (Vaughen & Bloch, 2016).

This systematic approach contributes to safety, but at the same time it is also an instrumental approach that accepts risks and their consequences to a certain extent.

Research shows that initial risk sessions in particular contribute to risk awareness and risk management. Keeping lists and reporting do not do so.

Some things should never go wrong!

In most cases, risks are estimated and assessed by establishing a risk acceptance rate. But what if you wish that something never goes wrong?

For example, you don't want people to die or become permanently disabled because of an accident, or people to be innocently imprisoned.

Some things can't go wrong! At the same time, we know we're always at risk. What can you do, besides using all kinds of models, lists and reports, to make sure everything goes well?

People are not always good at assessing risks.

Daniel Kahneman has written several books on risk assessment.  These include systematic biases in the assessment of costs and benefits. People usually unconsciously use methods to estimate chances of events and their value. These methods also partly determine the way in which people perceive, interpret and make decisions about the space around them. The various methods lead to both overestimation and underestimation and to both overvaluation and undervaluation. Kahneman showed, for example, that people overestimate the probability of a combination of a flood and an earthquake, rather than just a flood of equal magnitude. And that, of course, is a statistical impossibility.

The prospect theory states that people unconsciously adopt strategies in which they allow potential losses to outweigh potential benefits of the same magnitude. Avoiding risks is therefore preferable to an equal chance of profit.

Another essential point is that a new or future situation is not judged by the characteristics of that new situation, but by the change compared to the existing situation. For example, a shower of complaints about noise nuisance caused by aircraft occurs particularly when these machines fly over routes that they normally hardly use. We get used to it very quickly.

Prospect theory undermines the concept of rationality that is so important to economists. In many cases a decision is irrational; based on basic emotions and shortcuts. Normally nothing wrong with that!  It takes little energy and the consequences can usually be absorbed. But what if the outcome of your decision can have disastrous consequences?

Logically, gathering as much information as possible before you make a choice, on average, produces better results. Even when there is little time left. Fortunately, you then have your team. With your team you see more, you know more and you can do more. Make use of that!

Critical decision making

Where people work together, decisions are made. When the interests are big, the decision becomes all the more critical. The aerospace industry has been training on this for decades. An effective decision-making process can, depending on the situation, be implemented in different ways; sometimes through consultation, sometimes democratically, sometimes very autocratically. Every type of decision-making has its advantages and disadvantages.

As long as it is possible, it is wise to make use of all the information available within your team. Even when time is pressing. This demonstrably leads to better results.

This type of decision making requires an active attitude from each team member when it comes to identifying and evaluating possible alternatives. Group dynamics are also important. Everyone must be able to express their concerns and make proposals. Dominant or non-assertive behavior does not work effectively. Equivalence, independent of formal and functional hierarchical relationships, is not always as self-evident as it seems.

In our training in the B737 simulator it becomes clear in a playful way where, on the road to an optimal decision, there are pitfalls, how to deal with them and where to gain as a team. Not only in the cockpit and/or critical situations but also in daily professional life.