Risk Management CPT J. Craig SG 190 Risk Benefit

Risk Management Purpose Introduce the concept of risk management References: FM 101-5, Appendix J

Risk Management Outline What is Risk Management? Why Risk Management? Key Definitions The Risk Management Process Risk Management Integration Summary Conclusion

Risk Management What is Risk Management? Originally for high-risk complex activities (Space, Aviation) Applicable to all Army operations at all levels Systems based concept Not a Science; not “Common Sense” Not Risk Avoidance!

Risk Management Why Risk Management? Preserve combat power Because it works! –Korean cold weather example –Dramatic decrease in accidents Army-wide FY 96 Accident Rates Total Accident Rate 4.22 per 1000 soldiers record low according to Army Safety Center, Jan 97 Total Accident Rate 4.22 per 1000 soldiers record low according to Army Safety Center, Jan 97

Risk Management Key Definitions Hazard Risk –Probability –Severity Risk Assessment Risk Management Residual Risk Gambling Bold, Aggressive Risk Taker vs. Gambler ?

Risk Management The Process Event Hazard 1 Hazard 2 Hazard 3 1. Hazard Identification Hazard 1 - Probability/Severity Hazard 2 - Probability/Severity Hazard 3 - Probability/Severity 2. Hazard Assessment Options Control A Control B Control C Control D 3. Options and Decisions Plans Orders SOPs 4. Implementation 5. Supervise

Risk Management The Process Compressible, flexible Level of detail depends on: –Time available –Level of risk Control all risks that can be controlled Accept no unnecessary risks Make decisions at appropriate level

Risk Management Risk Management Integration Embed RM in all Army does Incorporates AAR –Were controls communicated? –Were controls implemented? –Was Risk Management effective? Risk Management Integration Plan –Draft dated 24 Dec 97 The Next Generation

Risk Management Summary What Risk Management is Why Risk Management is important Definitions The Risk Management process Risk Management Integration Questions?

Risk Management Conclusion “Risk management helps us preserve combat power and retain the flexibility for bold and decisive action. Proper risk management is a combat multiplier that we can ill afford to squander….” General Reimer