Operational Risk Management

ORM Definition ORM is the process of dealing with the risks associated with military operations, which includes: risk assessment, risk decision making and implementation of effective risk controls.

Objectives Upon completion of this lesson, you will be able to: Define Operational Risk Management (ORM) Define Time-Critical Risk Management (TCRM) Describe the levels of ORM Discuss the link between the ORM 5 Step Process and TCRM Discuss how TCRM increases situational awareness and decreases risks Apply TCRM to real-life situations

The ORM Process Is a decision making tool used by personnel at all levels to increase effectiveness by identifying, assessing, and managing risks Increases our ability to make informed decisions. Minimizes risk to acceptable levels. Applies both on the job and in off-duty activities. “ORM must be practiced 24 hours a day, 7 days a week, 365 days a year.”

Principles of ORM Accept risk when benefits outweigh the costs. Accept no unnecessary risk. Anticipate and manage risk by planning. Make risk decisions at the right level. The goal of ORM is not to eliminate risk, but to manage risk so that the mission can be accomplished with the minimum amount of loss. Only take risks that are necessary to accomplish the mission. Risks are more easily controlled when they are identified early in the planning process. When the leader responsible for executing the mission determines that the risk associated with that mission cannot be controlled at their level, or goes beyond the commander’s stated intent, they shall elevate their decision to their chain of command.

Controls become resources during execution Levels of ORM Strategic Tactical Time Available for Planning In-Depth Deliberate Time Critical Limited/No Time Mission & Task Success Controls become resources during execution The RM process is applied on 3 levels: in-depth, deliberate, and time critical. The basic factor that differentiates each level is time; that is the amount of time available to dedicate to the preparation and planning of missions or tasks. The figure above illustrates the levels of ORM and how they relate to each other. Note that there is no defined line where one level stops and another begins. In-Depth: Refers to situations when time is not a limiting factor and the right answer is required for a successful mission or task. Examples include: long term planning of complex or contingency operations. Deliberate: refers to situations when there is ample time to apply the RM process to the detailed planning of missions or tasks. Example: Planning of unit missions, tasks or events. Time Critical: This is the level at which personnel operate on a daily basis both on and off duty. Charts / Flips Ship/Aircraft (Systems Safety) Instructions Equipment Design Formal Training Operational Planning Mission Briefs CO Standing Orders Safety Equipment Team/Crew Mission Execution Checklist Change Management (Mission/Crew Change) Equipment Degradation

ORM Process Cycle Identify the Hazards Missions Assess the Hazards Analyze Mission Determine Hazard Root Causes List Hazards Missions Lessons Learned New Hazards Assess the Hazards Assess the severity Assess Probability Complete Risk Assessment Supervise Monitor Review Feedback Adjust Controls The first step in the ORM process is to identify the hazards. Implement Controls Make Implementation Clear Establish Accountability Provide Support Make Risk Decisions Identify Control Options Determine Control Effects Determine Residual Risk

Identify the Hazards A hazard is any condition with the potential to negatively impact mission accomplishment or cause injury, death, or property damage. To identify the hazards: Analyze the mission – Review the plans and orders describing the mission or task to ID all tasks, requirements and conditions then create a sequential or chronological list of all major events or tasks in a mission List the hazards – Review each event in the sequence of tasks for hazards. Involve operators and those with applicable experience. Brainstorming is useful for this preliminary hazard analysis. Ask “what if” to think about what could go wrong. Determine the root cause - Make a list of the causes associated with each identified hazard. The root cause is the first link in the chain of events leading to mission or task degradation.

ORM PROCESS CYCLE Identify the Hazards Missions Assess the Hazards Analyze Mission Determine Hazard Root Causes List Hazards Missions Lessons Learned New Hazards Assess the Hazards Assess the severity Assess Probability Complete Risk Assessment Supervise Monitor Review Feedback Adjust Controls The second step in the ORM process is to assess the hazards. Implement Controls Make Implementation Clear Establish Accountability Provide Support Make Risk Decisions Identify Control Options Determine Control Effects Determine Residual Risk

Assess the Hazards For each hazard indentified, determine the associated degree of risk in terms of probability and severity. The result of the risk assessment is a prioritized list of hazards, which ensures that controls are first identified for the most serious threat to mission or task accomplishment. Risk: An expression of possible loss due to a hazard in terms of severity and probability. Severity: Determines how bad the results would be if the hazard caused a mishap. Qualitatively categorized from 1 to 4, with 1 being the most severe. Probability: Determines how likely the hazard could cause a mishap. Qualitatively categorized from A to D, with A being the most probable.

Severity Categories Cat I: Death, loss of facility/asset or result in grave damage to national interests. Cat II: Severe injury, illness, property damage, damage to national or service interests or degradation. Cat III: Minor injury, illness, property damage, damage to national or service interests or degradation. Cat IV: Minimal threat to personnel safety or health, property, national, service or command interests use of assets.

Probability Criteria Subcategory A: A mishap likely to occur immediately or within a short period of time. Subcategory B: Will cause a mishap in time. Subcategory C: May cause a mishap in time. Subcategory D: Unlikely to cause a mishap.

Risk Assessment Code Matrix The Risk Assessment Code (RAC) Matrix is used to determine the RAC for a hazard. You must cross probability and severity to obtain this code. Risk Assessment Matrix PROBABILITY Frequency of Occurrence Over Time A Likely B Probable C May D Unlikely I Loss of Mission Capability, Unit Readiness or Asset; Death 1 2 3 II Significantly Degraded Mission Capability or Unit Readiness; Severe Injury or Damage 4 III Degraded Mission Capability or Unit Readiness; Minor injury or Damage 5 IV Little or No Impact to Mission Capability or Unit Readiness; Minimal Injury or Damage. Risk Assessment Codes 1 – Critical 2 – Serious 3 – Moderate 4 – Minor 5 – Negligible SEVERITY Effect of Hazard

ORM PROCESS CYCLE Identify the Hazards Missions Assess the Hazards Analyze Mission Determine Hazard Root Causes List Hazards Missions Lessons Learned New Hazards Assess the Hazards Assess the severity Assess Probability Complete Risk Assessment Supervise Monitor Review Feedback Adjust Controls The third step in the ORM process is to make risk decisions. Implement Controls Make Implementation Clear Establish Accountability Provide Support Make Risk Decisions Identify Control Options Determine Control Effects Determine Residual Risk

Criteria for Establishing Effective Controls Suitability Feasibility Acceptability Explicitness Support Standards Training Leadership Individual

Control Options Reject the risk Avoid the risk Delay an action Transfer the risk Compensate for the risk

Types of Controls Engineering Controls: examples include material selection or substitution Administrative Controls: examples include warnings, markings, placards, signs, written policies, instructions, SOPs Physical Controls: examples include PPE, fences, special oversight personnel

ORM PROCESS CYCLE Identify the Hazards Missions Assess the Hazards Analyze Mission Determine Hazard Root Causes List Hazards Missions Lessons Learned New Hazards Assess the Hazards Assess the severity Assess Probability Complete Risk Assessment Supervise Monitor Review Feedback Adjust Controls The fourth step in the ORM process is to implement controls. Implement Controls Make Implementation Clear Establish Accountability Provide Support Make Risk Decisions Identify Control Options Determine Control Effects Determine Residual Risk

Implement Controls Implementing Controls Requires: Clearly communicating plan to all involved personnel Establishing accountability Guaranteeing necessary support is available Careful documentation of each step in the RM process facilitates risk communication and the rational processes behind the RM decisions.

ORM PROCESS CYCLE Identify the Hazards Missions Assess the Hazards Analyze Mission Determine Hazard Root Causes List Hazards Missions Lessons Learned New Hazards Assess the Hazards Assess the severity Assess Probability Complete Risk Assessment Supervise Monitor Review Feedback Adjust Controls The fifth step in the ORM process is to supervise. Implement Controls Make Implementation Clear Establish Accountability Provide Support Make Risk Decisions Identify Control Options Determine Control Effects Determine Residual Risk

Supervise Supervision is a key step in the ORM process. It involves determining the effectiveness of risk controls throughout the mission or task. This involves three actions: Monitoring the effectiveness of risk controls Determining the need for further assessment of all or a portion of the mission or task due to an unanticipated change Capturing lessons learned

Time Critical Risk Management Red Green Yellow TCRM is using risk management concepts when time and resources are limited.

Introduction: What is TCRM? TCRM is using risk management concepts when time and resources are limited. Applying ORM principles at the point of, or during execution of a mission or task Methodology is similar but less deliberate than the five step process The ABCD Model A - Assess the situation B - Balance Resources C - Communicate to others D - Do and Debrief the event Red Green Yellow

Why TCRM? Experience is result of learning events Leadership has a responsibility to marshal and coordinate experience from all personnel Inconsistent levels of team and individual responses based on different levels of experience The ABCD model provides ability to match previous mission to new experience Provides common language in natural format

Nature of TCRM Designed to assist when Working in a dynamic environment Monitoring a static or routine situation Making a decision with partial information Develop sound, consistent habits Consistent with continuous improvement Requires unique set of skills Relies on experience Standardizes communication

ABCD Model Red Yellow Green Green: indicates errors may occur, but will be caught by individual Yellow: indicates the potential for consequential errors have increased Red: indicates errors may occur that cannot be caught and become consequential to the task or mission The swooping arrow represents a return to good SA and mitigation of risk The blocks represent the multiple levels of resources *The target is used during team communication to focus one or more individuals into an understanding of situational conditions or an individual may use it as a self-assessment tool Examples of resources include: policies, tactics, procedures, processes, checklists, automation, briefings, external resources, knowledge, skills, and techniques. The redundant alignment of the blocks is designed to illustrate stacking resources to prevent errors that may become consequential, such as a resource improperly used or a problem within a resource (i.e. flawed checklist or missing procedure).

ABCD B – Balance Resources C – Communicate to Others The ABCD block represents the TCRM mnemonic A – Assess the situation B – Balance Resources C – Communicate to Others D – Do and Debrief the Event

Link Between TCRM and 5-Step Process Is not a replacement for the 5-step deliberate process Is the practical application of the 5-step process in a time-critical environment

Assess the Situation First two steps of the 5-step process Requires accurate perception of situation in a relatively short period of time Must maintain good SA Reliant on individuals ability to comprehend situation and apply appropriate, available resources quickly and effectively Difference between success and failure

Balance Resources Tied specifically to making risk decisions (steps 3-5 of the 5-step process) Must consider using resources created for the mission or activity Thorough planning prior to event will increase availability of appropriate resources Examples: PPE, proper training, understanding task or mission

Communicate to Others “C” reminds us, explicitly, to communicate Maintains good SA, task loading, & crew factors are critical components Communication tends to become limited under stress/time constraints Who needs to know? What can be done? Who can help or assist?

Do and Debrief the Event Tied to steps 4 & 5 of the 5-step process Ensure the feedback loop is performed Identify what worked and what did not Ensure lessons are learned, recorded, & disseminated Improves performance, mitigates risks Is essential to completing the ABCD loop

Applying TCRM into the Planning Process Skills Process 1. Situational Awareness I know my environment I can see changes 2. Mission Analysis I can assess the changes I can see how they affect my job/mission 3. Assertiveness I have confidence in myself, my team, and my leadership to bring new threats to their attention 4. Communication I need to let my teammates or others involved know what I know 5. Leadership My leaders accept my plan for action or know how to act to manage new risk 6. Adaptability/Flexibility The plan is flexible and we can adapt to changes 7. Decision Making We have enough information, time and a good plan of action, or we need help ABCD for Decision Making Assess the mission for potential adverse consequences Balance the use of Resources to minimize risk Communicate Risks and Intentions Do (and debrief to improve future performance)

Time Critical Scenarios ™ NIGHT UNREP Routine Evolution Time Constrained Supply ship committed (perceived) What’s Different? Late at night start (2300) Winds and seas different than forecast Maintaining station difficult Keeping fuel hoses seated very difficult Decision Distractions Desire to get the job done now Fatigue Routine Evolution Option A Continue with evolution Risks – damage to equipment, people Option B Breakaway and reassess hazards and controls Risks – delay, lower than normal fuel

Time Critical Scenarios ™ RETURN FROM LEAVE Routine Drive of 300 miles End of Major Holiday Weekend Muster at 0730 Getting underway in two days What’s Changed? Family early PM dinner runs late Rear tire deflated (slow leak from nail puncture) Light fog forms (not forecasted) Decision Distractions Never been late from leave New Division CPO Made this drive many times before Option A Continue with Drive Risks – fatigue, flat tire, heavy traffic Option B Call ship and speak to OOD Risks – Angry CPO, miss underway briefs

TCRM Card

Conclusion Practical use of the ABCD Model by all Navy personnel will sustain a responsive capability to effectively meet personal challenges or mission contingencies now and in the future

NROTC ORM Unit mission Training syllabus Medical reporting Safety surveys Physical training Swim Program Sail Training Rifle/Pistol Close Order Drill Marine Field Training Exercises Marine hikes Orientation Levels of ORM training in NROTC Program Pre-Mishap Safety Plan Medical Reporting TCRM Cards Sample discussion: ORM is briefed before every PT session. ORM will be briefed before holiday and summer vacations to all MIDN. Specifics such as phone numbers, contacts, and procedures will be given during the brief. There will be a Duty Officer available 24 hours a day on the unit cell phone. Use general common sense when planning to go away for a holiday break or doing PT on your own.

Questions & Summary