Risk Management.

Risk management is the process of identifying and controlling hazards. It is applicable to any mission and environment.

The 5 steps are:

1. IDENTIFY HAZARDS

Identify hazards, consider all aspects of current and future situations, environment, and known historical problem areas.
2. 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.
3. DEVELOP CONTROLS, MAKE A RISK DECISiON

Develop control measures that eliminate the hazard or reduce the risk. As control measures are developed, risks are re-evaluated until all risks are reduced to a level where benefits outweigh potential costs.
4. IMPLEMENT

Put controls in place to eliminate the hazards or reduce their risk.
5. SUPERVISE & EVALUATE

Enforce standards and controls. Evaluate the effectiveness of

controls and adjust/update as necessary.

Risk Management: Definition of Terms

HAZARD: Any real or potential condition that can cause injury, illness, or death of personnel, or damage to or loss of equipment or property.

RISK: Chance of hazard or bad consequence; exposure to chance of injury or loss. Risk level is expressed in terms of hazard probability and severity.

EXPOSURE: The frequency and length of time subjected to a hazard.

PROBABILITY: The likelihood that an event will occur.

SEVERITY: The expected consequence of an event in terms of degree of injury, property damage, or other mission-impairing factors that could occur.

CONTROLS: Actions taken to eliminate hazards or reduce their risk.

RISK ASSESSMENT: The identification and assessment of hazards (first two steps of risk management process).

RESIDUAL RISK: The level of risk remaining after controls have been identified and selected for hazards that may result in loss. Controls are identified and selected until residual risk is at an acceptable level or until it cannot be practically reduced any further.

RISK DECISION: The decision to accept or not accept the risk(s) associated with an action; made by the commander, manager, or individual responsible for performing that action.

P. Linse

2005-08-17

KeatorM

USDA Forest Service