Understanding Risk Analysis and Management in Engineering Design
SAFETY AND RISK
Concept of Safety
Risk is a key element in any engineering design. A thing is considered safe if its risks are judged to be acceptable. Safety involves subjective value judgments about what constitutes acceptable risk for a given person or group.
Types of Risks
- Voluntary and Involuntary Risks
- Short-term and Long-Term Consequences
- Expected Portability
- Reversible Effects
- Threshold levels for Risk
- Delayed and Immediate Risk
Risk Analysis
Risk analysis is one of the most elaborate and extensive studies conducted in engineering design. It involves thorough site visits and discussions with personnel. The study typically covers risk identification, analysis, assessment, rating, and suggestions for risk control and mitigation. Interestingly, risk analysis can be expanded into a full-fledged risk management study, which also includes residual risk transfer and risk financing.
Steps in Risk Analysis:
- Hazard identification
- Evaluation of failure modes and frequencies from established sources and best practices
- Selection of credible scenarios and risks
- Fault and event trees for various scenarios
- Consequence-effect calculations using models
- Individual and societal risks
- ISO risk contours superimposed on layouts for various scenarios
- Probability and frequency analysis
- Established risk criteria of countries, bodies, and standards
- Comparison of risk against defined risk criteria
- Identification of risk beyond the location boundary, if any
- Risk mitigation measures
Risk analysis is undertaken after a detailed site study and reflects Chilworth’s exposure to various situations. It may also include studies on frequency analysis, consequence analysis, and risk acceptability analysis, if required. Probability and frequency analysis covers failure modes and frequencies from established sources and best practices for various scenarios and probability estimation.
RISK BENEFIT ANALYSIS AND REDUCING RISK
Risk-benefit analysis compares the risk of a situation to its related benefits. For research involving more than minimal risk of harm to subjects, the investigator must ensure that the benefits clearly outweigh the risks. Only with a favorable risk-benefit ratio can a study be considered ethical.
Risk Benefit Analysis Example
Exposure to personal risk is a normal aspect of everyday life. We accept a certain level of risk as necessary to achieve certain benefits. In most of these risks, we feel we have some control over the situation. For example, driving an automobile is a risk most people take daily. “The controlling factor appears to be their perception of their individual ability to manage the risk-creating situation.” Analyzing the risk of a situation is highly dependent on the individual doing the analysis. When individuals face involuntary risks, over which they have no control, risk aversion becomes their primary goal.
Evaluations of future risk:
- Real future risk as disclosed by fully matured future circumstances
- Statistical risk, as determined by currently available data, measured actuarially for insurance premiums
- Projected risk, analytically based on system models structured from historical studies
- Perceived risk, as intuitively seen by individuals
Air transportation as an example:
- Flight insurance company – statistical risk
- Passenger – perceived risk
- Federal Aviation Administration (FAA) – projected risks
How to Reduce Risk?
- Define the Problem
- Generate Several Solutions
- Analyze each solution to determine the pros and cons
- Test the solutions
- Select the best solution
- Implement the chosen solution
- Analyze the risk in the chosen solution
- Try to solve it or move to the next solution
Risk-Benefit Analysis and Risk Management
Informative risk-benefit analysis and effective risk management are crucial for the commercial success of any product. We are a leader in developing statistically rigorous, scientifically valid risk-benefit assessment studies that demonstrate the level of risk patients and decision-makers are willing to accept to achieve the benefits provided by your product.
Risk-Benefit Modeling
Systematically quantify the relative importance of risks and benefits to demonstrate the net benefits of treatment
Risk-Benefit Tradeoffs
Quantify patients’ maximum acceptable risk for specific therapeutic benefits