1. RISK ASSESSMENT TOOL PREVIEW
Jeffrey Sedillos, Vice President of Operations and Construction
SiteWise Corporation
May 2015 1

2. Definitions
Risk relates to the potential of all threats (and opportunities) which can affect (adversely or favorably) the achievement of objectives for an investment.
Uncertainty: The gap between the information required to estimate an outcome and the information already possessed by the decision maker.
Risk Management: The process of identifying, analyzing, and responding (response development and response control) to project risk.

3. Risk Management: Definition
An organized means of identifying and measuring risks and developing, selecting and managing options for handling these risks.
helps the project manager be proactive, rather than reactive
minimize the risks
allocate the risks equitably.

4. Risk Management: 3 Issues
The parties must discuss and decide:
What levels of risk are realistic to assume?
Who can best assume each risk?
What risks would be covered by insurance carriers?
What happens if these issues are not addressed?

5. Risk Flow Recognize exposure to possible loss
Estimate maximum loss and probability of occurrence
Is maximum possible loss considered Severe?
Yes No

6. collect more information and knowledge
Uncertainty
Most effective way to deal with uncertainty is to
collect more information and knowledge
When this is expensive or not feasible we try to quantify uncertainty using analytical techniques.

7. Managing Risk

8. Avoid Consequences

9. Risk Response
Decide on the actions to be taken in response to key risks.
Actions can include:
Reduction in uncertainty by obtaining more information. This generally leads to a re-evaluation of the likelihood.
Eliminate or avoid the risk factor, i.e., partial or complete project re-design, utilization of a different strategy or method, etc.
Transfer the risk element by contracting out affected work
Insure against the occurrence of the factor
Abort the project if the risk is intolerable and no other means can be undertaken to mitigate its damages.
Plan response to key risks.
Communicate mitigating strategy and response plan to risk review team.

10. Outline of Risk Analysis Process
Risk Review:
Identify factors
Evaluate Risk
Likelihood
Impact
Consequences
Action Plan
Develop Risk Management Plan

11. Risk Assessment Factors
Identify risk factors for the project. This step can make use of checklists and/or published literature on risk, but is most effective through properly facilitated brainstorming session(s).
Quantify risk factors

12. Risk Assessment Factors
Quantify Risk Factors:
Subjectively assess each factor and its impact if it occurs.
Determine the likelihood of the factor being encountered (e.g. probability, or a subjective descriptor).
Determine the magnitude of the impact if the factor is encountered (e.g. dollar value or a subjective descriptor).
Determine the overall impact of the factor by multiplying likelihood (ii) by magnitude (iii).
Sort factors into groups based on overall impact
Identify the factors that can be considered negligible in terms of overall impact so as to focus on key factors in the remainder of the analysis

13. Risk Categories (7)
Obstructions (buried utilities, density of utilities)
Traffic (control requirements, safety)
Surface Features (landscaping, etc.)
Soil Conditions (geotechnical information)
Permit Requirements (staging area, regulatory factors, daily construction times)
Construction Standards
Quality of Utility Locates

14. Risk Model Road Map ELECTRIC DISTRIBUTION FACILITIES Private Property
Public ROW
Risk Categories for Private Property
Risk Categories for Public ROW

15. Risk Index/Consequences
Consequences = (Likelihood of Occurrence) x (Impact)

16. Likelihood of Occurrence
Descriptor
Probability
Value
Explanation
Certain/Highly Likely
90%-100%
9-10
Very frequent occurrence.
Likely
75%-89%
High likelihood of occurrence.
Possible
50%-74%
5-7.4
Could occur, over chance.
Unlikely
20%-49%
2-4.9
Low likelihood of occurrence, less than chance.
Rare/Extremely Unlikely
0%-19%
0-1.9
Negligible, not likely to occur.

17. Impact/Magnitude Descriptor Explanation Value Severe
Substantial impact on project
100
Serious
Major threat to project. 75
Moderate
Has a moderate impact on project. 50
Marginal
Small, little effect on project. 20
Negligible
Minimal effect on project. 1

18. Consequences Risk Score Risk Category Response/Action Over 750
Intolerable
Must eliminate or transfer.
Undesirable
Attempt to avoid or transfer.
Acceptable
Accept and manage risk.
Less than 200
Negligible
Can be ignored but should be managed.

19. Risk Quantification Select a Risk Factor for Quantification
Assess Causes and Impacts
Assess the Likelihood of Occurrence
Assess the Magnitude of Impact
Calculate the Severity
Assign a Response
Action Plan

20. Benefits
Util-A-Risk will provide a measure of “risk” in a given scenario prior to installation
Provides an opportunity to partner with client(s) to reduce risks, provide a safer installation while saving time and money for the client and contractor.

21. Don’t Put Yourself in a Risky Situation!