1. Introduction to
Risk Management

2. Terminal Learning Objectives
Upon completion of this lesson, you will be able to:
Define Operational Risk Management (ORM)
Describe the levels of ORM
Discuss the link between the ORM and successful events.
Apply ORM to everyday Young Marine Activities.

3. What is Operational Risk Management?
The term Operational Risk Management(ORM) is defined as a continual cyclic process which includes risk assessment, risk decision making, and implementation of risk controls, which results in acceptance, mitigation, or avoidance of risk.

4. The ORM Process
Is a decision making tool used by Registered Adults and Young Marines 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 to all activities.
“ORM must be practiced 24 hours a day, 7 days a week, 365 days a year.”

5. 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.

6. ORM Process Cycle Identify the Hazards YM Activities
Analyze
Activity
Determine Hazard Root Causes
List
Hazards
YM Activities
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

7. Identify the Hazards
A hazard is any condition with the potential to negatively impact an event or cause injury, death, or property damage.
To identify the hazards:
Analyze the event – Review the plans and details describing the YM activity to ID all tasks, requirements and conditions then create a sequential or chronological list of all major events or tasks in a YM activity.
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 Activity or task degradation.

8. ORM PROCESS CYCLE Identify the Hazards YM Activities
Analyze
Activity
Determine Hazard Root Causes
List
Hazards
YM Activities
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

9. 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 the activity 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.

10. 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.

11. 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.

12. 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.

13. ORM PROCESS CYCLE Identify the Hazards YM Activities
Analyze
Activity
Determine Hazard Root Causes
List
Hazards
YM Activities
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

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

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

16. Types of Controls
Engineering Controls: examples include material selection or substitution. (i.e. poor quality rope swing, ineffective tents, etc.)
Administrative Controls: examples include warnings, markings, placards, signs, written policies, instructions, SOPs, additional training.
Physical Controls: examples include PPE, fences, special oversight personnel (i.e. NRA instructor at range, proper running shoes, boots that fit, quality socks, etc.)

17. ORM PROCESS CYCLE Identify the Hazards YM Activities
Analyze
Activity
Determine Hazard Root Causes
List
Hazards
YM Activities
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

18. Implement Controls Implementing Controls Requires:
Clearly communicating the 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.

19. ORM PROCESS CYCLE Identify the Hazards YM Activities
Analyze
Activity
Determine Hazard Root Causes
List
Hazards
YM Activities
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

20. Supervise
Supervision is a key step in the ORM process. It involves determining the effectiveness of risk controls throughout the YM activity 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 (AAR)

21. How do we do it?

22. Take advantage of what is already out there.
DD form 2977
Newest Version

23. Older version
DD form 7566

24. Examples