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Operational Risk Management (ORM)

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Presentation on theme: "Operational Risk Management (ORM)"— Presentation transcript:

1 Operational Risk Management (ORM)
. 1. Identify the Threats of Harm 6. Supervise and Review 2. Assess the Risk 5. Implement Risk Controls 3. Analyze Risk Control Measures 4. Make Control Decisions 721 Air Mobility Operations Group

2 ORM PUBLICATIONS AFPD 90-9, Operational Risk Management
. 1. Identify the Threats of Harm 6. Supervise and Review 2. Assess the Risk 5. Implement Risk Controls 3. Analyze Risk Control Measures AFPD 90-9, Operational Risk Management AFI , Operational Risk Management AFPAM , Operational Risk Management Guidelines and Tools 4. Make Control decisions

3 WHAT IS ORM? . 1. Identify the Threats of Harm 6. Supervise and Review 2. Assess the Risk 5. Implement Risk Controls ORM is a logic-based common-sense approach to making calculated decisions on human and material factors before, during, and after missions, activities, and operations both on- and off-duty. 3. Analyze Risk Control Measures 4. Make Control decisions

4 WHAT IS ORM? Using common sense and not being stupid!
. 1. Identify the Threats of Harm 6. Supervise and Review 2. Assess the Risk 5. Implement Risk Controls 3. Analyze Risk Control Measures 4. Make Control decisions Using common sense and not being stupid! Problem -- Common sense isn’t always common and to some people it doesn’t always make sense.

5 OPERATIONAL RISK MANAGEMENT
. 1. Identify the Threats of Harm 6. Supervise and Review 2. Assess the Risk Why do I need it? It could save your life Who should use it? Everyone When do I use it? All of the time--on-and-off duty How do I use it? Read on 5. Implement Risk Controls 3. Analyze Risk Control Measures 4. Make Control decisions

6 TYPES OF ORM Time- Critical (done in your head) Deliberate Strategic
. 1. Identify the Threats of Harm 6. Supervise and Review Time- Critical (done in your head) Takes only a minute or so to do You do this each day (hopefully) Deliberate This may take a few hours or it could take weeks Strategic Very long term (could take months or years) 2. Assess the Risk 5. Implement Risk Controls 3. Analyze Risk Control Measures 4. Make Control decisions

7 Example of Time-Critical ORM
. 1. Identify the Threats of Harm 6. Supervise and Review You just finished working a 12-hour shift and your buddy says, “Why don’t we drive to Dallas?” What are the risks? How serious are the risks? Analyze the situation Make your decisions and implement risk controls 2. Assess the Risk 5. Implement Risk Controls 3. Analyze Risk Control Measures 4. Make Control decisions

8 Example of Time-Critical ORM
. 1. Identify the Threats of Harm 6. Supervise and Review Risks Falling asleep while driving Running off the road Colliding with an on-coming vehicle How serious? Very, you could kill someone - maybe you Analyze the situation... Sure, I’ll go to Dallas---but first I need some sleep 2. Assess the Risk 5. Implement Risk Controls 3. Analyze Risk Control Measures 4. Make Control decisions

9 Fundamental Goals of ORM
. 1. Identify the Threats of Harm 6. Supervise and Review 2. Assess the Risk Enhance mission effectiveness Integrate ORM into mission processes Train all AF personnel to manage risks in all their on-and off-duty activities Identify opportunities to increase Air Force combat effectiveness 5. Implement Risk Controls 3. Analyze Risk Control Measures 4. Make Control decisions

10 ORM PRINCIPLES Accept no unnecessary risks
. 1. Identify the Threats of Harm 6. Supervise and Review 2. Assess the Risk 5. Implement Risk Controls Accept no unnecessary risks Make risk decisions at the appropriate level Accept risks when benefits outweigh costs Integrate ORM into AF doctrine and planning at all levels 3. Analyze Risk Control Measures 4. Make Control decisions

11 Accept No Unnecessary Risk
. 1. Identify the Threats of Harm 6. Supervise and Review Risk is the probability and severity of failure or loss resulting from exposure to various threats of harm Three reasons for unnecessary risk: Not aware of the risk An incorrect assessment of cost versus benefit Interpreting “bold risk taking” as gambling 2. Assess the Risk 5. Implement Risk Controls 3. Analyze Risk Control Measures 4. Make Control decisions

12 Make Risk Decisions at the Appropriate Level
. 1. Identify the Threats of Harm 6. Supervise and Review 2. Assess the Risk 5. Implement Risk Controls Who will answer in the event of an accident? Who is the senior person at the scene of the task? Who knows the full benefits and cost of a risk? What level makes the most operational sense? 3. Analyze Risk Control Measures 4. Make Control decisions

13 Accept Risks When Benefits Outweigh the Costs
. 1. Identify the Threats of Harm 6. Supervise and Review 2. Assess the Risk The three key questions are: What is the potential cost of a risk versus the benefit it may produce? What is the cost of taking a risk versus the cost of not taking a risk? Do the total benefits outweigh the total costs? 5. Implement Risk Controls 3. Analyze Risk Control Measures 4. Make Control decisions

14 Integrate ORM Into AF Doctrine and Planning At all Levels
. 1. Identify the Threats of Harm 6. Supervise and Review 2. Assess the Risk 5. Implement Risk Controls 3. Analyze Risk Control Measures Risks are more easily assessed and managed in the planning stages of a task Early integration provides the decision maker the greatest opportunity to apply ORM principles Use the Air Force 6-Step Process 4. Make Control decisions

15 Step 1 - Hazard ID Threats of Harm – Any real or potential condition that can cause mission degradation, injury, illness, or death to personnel or property damage to or loss of equipment or property

16 Step 2 - Risk Assessment Assessment Pitfalls:
Use the Risk Assessment Matrix to assign a “Value” to threats of harm (AFPAM ) Assessment Pitfalls: Over Optimism - “It can’t happen to us. We’re already doing it.” Inaccuracy - Misunderstood data Alarmism - “The sky’s falling!” Prejudice - Hidden agenda vs facts

17 Step 3 - Analyze Risk Control Measures
There are three actions involved in this step: Identify Control Options Determine Control Effects Prioritize Risk Controls

18 Action 1 - Identify Control Measures
Reject - Risk Outweighs the Benefit Avoid - Do it a Different Way Delay - Problem May Go Away Transfer - Contract Out the Task Reduce - Incorporate Safety Devices

19 Action 2 - Determine Control Effects
What is the impact on the probability and severity of the threat of harm? What will the risk control cost? How will various risk control options work together?

20 Action 3 - Prioritize Risk Controls
Get operator input The best controls minimize the threats of harm to an acceptable level, while allowing completion of the mission.

21 Step 4 - Make Control Decisions
Select the best risk control Choose the right time to implement the control Decide on the appropriate level of implementation.

22 Step 5 - Implement Risk Controls
Make implementation clear Involve all personnel and coordinate as needed Establish accountability Who will be responsible Provide support Give feedback on results

23 Why Implementation Sometimes Fails
Operators dislike it Leaders dislike it It’s too costly It’s misunderstood Wrong control for the problem

24 Step 6 - Supervise & Review
Supervise - Assure controls are effective and detect needed changes Review - Was the benefit worth the cost Feedback - Cross talk and supply feedback up and down the chain of command

25 Final Thoughts All AF instructions/directives incorporate ORM into processes and need continued emphasis Some level of risk management must be used for all tasks and operations ORM is simply applying common sense on and off-duty

26 ORM Information For additional information
Go to the Air Force Safety Center website at


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