Risk management practical examples

The philosophy of risk management that an entity will not enter into an operation that poses an exposure of loss or wiU eliminate the exposure to a potential loss. An example is the replacement of a manual handling operation by a mechanical handling system. Primarily used in the risk management practices for corporate cost benefits in the analysis of insurance applications. 

Increasing application of the precautionary principle may see a growth in sound risk management practices, particularly where a regulator is involved. Processes already adopted by responsible organisations may become formalised to comply with regulatory requirements. For example ... 

The remaining sections of this chapter are concerned with the scientific difficulties encountered in the practice of risk assessment - in fact, it will be seen that there are critical aspects of the risk assessment process that cannot be adequately dealt with because of limitations in scientific understanding. Following this chapter is another on risk assessment, devoted to its practical applications, and then comes a third chapter providing examples of some new risk assessment challenges and approaches. After a final brief chapter on risk assessment in the courtroom, risk management returns in Chapter 11. 

Questions 2 and 3 imply a choice between expressing effects in terms of magnitude, frequency, and certainty. In practice, the assessment endpoint may often need to be dehned in terms of 2 or 3 of these dimensions. For example, it may be desirable to estimate the proportion of species (frequency) that will experience different levels of mortality (magnitude), and to provide confidence limits (certainty). Indeed, the risk manager s questions may imply an assessment endpoint with more than 3 dimensions, for example, if it is desired to express frequency in terms of space (e.g., number of hectares) and time (proportion of years). The dimensionality of the assessment endpoint will have major implications for all aspects of the analysis and for communication of results, so it is essential to discuss it carefully with the risk manager at the outset to ensure it meets their needs. 

This chapter begins with the regulatory basis for risk management programs, as far as is needed beyond the previous chapters on European and American regulations. Practical examples will then be considered. 

Ascertain the skills, experience and qualifications required to operate in that particular role. For example, the domain expert might need to have at least 5 years practical clinical experience and possess an affiliation with an appropriate professional body. The risk management representative should perhaps have received specific training and be able to evidence previously issued safety cases. Note that these criteria should be established in a vacuum and not be reverse engineered based on the characteristics of the individual whom one has in mind for the role. 

An example of a practical application of the method is the independent platform Respect-Code . This traceability system helps brands to increase trust with their consumers, as well as allowing them to enhance collaboration with supphers. It offers a smart risk management tool that shows what is happening across the supply chain and identifies room for improvement (www.respect-code.org). Another practical example of traceability systems is the MADE-BY Track Trace system that follows the trail of the clothes. From the MADE-BY code in the garment, the consumer can find out where the garment was made and by whom (http //www.made-by.org/). 

The terms failure and fault have specific meanings in the context of risk management. Failure refers to the nonfunctioning of a specific item of equipment fault refers to the nonfunctioning of a system or subsystem. For example, Pump P-IOIA may fail to operate. If the backup pump P-IOIB does not start, then a fault exists with the pumping system. (In practice, it is unusual for this semantic distinction to be scrupulously followed.)... 

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