IDENTIFYING HAZARDS
Most of the time we relate risks with the probability of a hazard taking place .
'Hazard' is an inherit capacity to cause damage - an intrinsic property .For example 'Arsenic' (a chemical substance) is hazardous ,which is a property and so is not probabilistic ,therefore not risky- risk is applied to events not properties . Hazards need to be quantified , observe their probability and therefore partially predicted.
Hazards and therefore risk s can be under three categories , economic , safety and environmental . The economic hazards have been studied for many years by the profession most interested in them , the insurance industry . As a result they have been quantified at their greater part . In the same way safety risks have been studied especially through research on the price people are willing to pay for avoiding the risk of injury or death . Quantification of environmental risk is contend 'any decision implies valuation and that if environmental valuation is not tried in the taking of an environmentally relevant decision , we do not know whether the decision was a sound one or not in terms of economic efficiency'(Barbe & Pearce,1991)
PROCEDURE OF MODELLING RISK
To be able to asses a certain risk we need to identify the hazards involved , to assign probabilities to these hazards and finally to model the whole situation . So that we accumulate a total risk. After assessing that risk we can take the appropriate action to avoid any misjudgements which could lead to hazards . An example of this procedure is following .
example :
If we take under consideration the example of building a dam .
(1) We have to identify and list of all possible hazards that could occur and considered serious . This could mean the systematic examination of all the components , structures and functions that are part of it .
(2) Break down the sequence of events that might lead to these hazards . For instance ,the alarm signalling high tide might not go off when it has to and lead to an overflow . This could be due to a breakdown of the water level meter caused by a faulty screw .
(3) Assign probabilities of malfunction to these different parts of the system ,that might lead to hazards , where statistical data exist . For example the failure rate of a certain screw could be found in records of its performance in other systems.
(4) starting from the bottom of the system towards the end , we can derive a total risk probability by multiplying the probability risk of each component leading to hazard .
At this point we can bring up some methods used to model and analyse the risks and failures in a system.
METHODS
In the last three decades in particular ,there where many methods developed especially where the analysis of risk is used for decision analysis .This was in a big part of it due to the increase of available computer power and the constant development of computational procedures . Some of these methods as taken from (C.B.CHAPMAN ,Risk Analysis , a view from 1990) , are presented below .
....first is the O.R.method in table 1
steps of the O.R. method :
1 Problem description . 4 Model and solution testing .
2 Model formulation . 5 Solution implementation .
3 Model solution .
table 1
....then is the CPM/PERT method which is similar to the O.R. method but is offering a series of steps which the decision maker can use to implement their models efficiently and effectively , particular to the problems they are considering and the models they are using , table 2
steps of the CPM/PERT method :
1 List of activities .
2 Estimate activity duration .
3 Asses precedence relationships .
4 Diagram activity .
5 Compute project duration and floats . table 2
6 Adjust for timetable restrictions .
7 Adjust for resource restrictions .
8 Implement plan .
9 Control and update .
....another technique for analysing risk is the one developed for B.P. international in the late 1970s and is shown in table 3.
steps of the SCERT method :
phase step
Scope identification of activities
identification of primary risks
identification of primary responses
identification of secondary risks
identification of secondary responses
Structure identification of minor and major risks
identification of specific and general responses
identification of simple and complex decision rules
risk response diagramming
table 3
Parameter identification of desired parameters
scenario identification and probabilities estimate
Manipulation risk computation
& Interpretation decision rule assessment for risk efficiency
decision rule assessment for risk balance
assessment of budget contingency
As we have seen statistical data and probabilities deriving from them are combined in the methods above with practical procedures , such as identification of hazards . As a result the user would be able to develop appropriate and more understandable models of the risks involved in a system . So models incorporating only mathematical models are not valid .
SUBJECTIVE ASSESSMENT OF RISK
After appropriate models have been constructed , is the turn of the person to make the decision of taking or not a risk . This person would have his/her own 'subjective' perception of risk . This particular person has particular ideas and concepts of risk which could be similar or to the people surrounding this person . This could be a result of the sharing of opinions , assumptions , beliefs between them . Also the confidence that this person has in institutions more than people outside his/her environment could lead him/her take decisions different than the other people outside this environment would do . As a conclusion the perception of risk is multidimensional .
Research has found that other factors except probabilistic risk levels can influence peoples(laypeople or scientists) perception of risk as intolerable .A way that may help us understand why people don't take only under consideration the absolute probabilistic value of risks can be found through psychology . A recent research has shown that people find more difficult to tolerate risks which are vivid in their memory and are connected with disasters ,such as earthquakes and fires . This is a result of some psychological tasks , existing to simplify complex mental rules which appreciate risks . And they are called Heuristics . The Heuristic rules relevant to the appreciation of risks are the 'availability' and the 'overconfidence' rules .
The availability heuristic is when people are quick in recalling events which are frequently occurring and enforce the intolerance of risk ,deriving from these events . These events can be real or can be an image taken from Cinema or T.V. For enable
homicides can be recalled easy as they are seen all the time on T.V. but in real life are very rare .
The overconfidence heuristic , as the title explains people can wrongly perceive risk when they are very confident in taking decisions based upon their own experience . For instance an electrician could underestimate the danger of electricity as he/she is always working with it .
Based on the same research some other reasons where found to make people
intolerant of risks , and they where :
............When risks are not managed by the person taking the risk.
............When they are taken compulsory by the person involved .
............When they were seen as unfair in the risk distribution.
............When the benefits from these risks are not clear.
............When they might cause hazard in ways not able to be observed.
............When they might cause harm to future generations.
............When they are not familiar to the bearer of the risk .
Therefore the perception of a risk is determined by a number of factors which sometimes has nothing to do with the absolute probabilistic chance of it happening , but depend on subjective feelings and estimations .
CONCLUSION
As we did observe ,there is a number of methods helping us to create appropriate models for the assessment of risk , using probabilistic values assigned to each hazard , and incorporating mathematical and practical methods in these models .
But when the decision has to be taken ,there is a number of factors influencing the decision maker ,away from absolute probabilities , affected by personal experiences , attitudes and beliefs . These factors vary between people . This fact makes it difficult to asses a risk in an 'objective' way . At that point the danger, of not taking a positive decision for the whole , arises . Probably the only way of taking a positive decision for the whole(company, environment, public safety) will be to consider all relevant information to the hazard involved and asses it in the most 'objective' way possible ,taking also under consideration the needs of the people involved .
Probably the only way to achieve this is by starting to use methods including all possibly identified risks that could be calculated arithmetically , then harmonising these methods ,to be accepted by the whole of those involved in taking the risks. And finally take a decision based on these calculations and common ideas beliefs attitudes of those involved in the risk to be taken .This would result in a common tolerance of the risk and future acceptance if a danger occurs .In few words all information available about a risk is necessary to be obtained before taking this risk.
References
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