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Improving Risk Management for
Agency-wide Application in
Transportation Asset Management
Richard Boadi, PhD
Transportation Asset and Infrastructure Management Conference
State College, PA
October 28-29, 2019
• Asset management and
risk management have
basically become
inseparable due to federal
regulations. How are
practitioners responding in
applying risk concepts
across the
enterprise/agency?
Problem Statement
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Performance
CostRisk
• Background
• State of the practice
• Future needs
• Summary
Presentation Outline
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Risk Management Background
Risk Definition
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RiskIn decision making
NegativeHinders goals
Internal threats
Within agency capabilities
External threats
Beyond agency capabilities
Positive
Supports goals
Risk is the effect of
uncertainty on
expected outcomes
(ISO 31000).
Risk Management Definition and Levels
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Risk management definition: processes and framework for managing
potential risks, including identifying, analyzing, evaluating, and addressing
the risks to assets and system performance. (23 CFR 515.5).
Source: FHWA
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State of the Practice
Risk Measurement
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Uncertainty
Likelihood
Consequence
Opportunities
Hazards
Threats
Vulnerability
Variability
Common Practice
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• Traditional approach
• Strong foundation at the project level
– Concepts, capabilities, tools, training, etc.
– Scope, cost overruns, schedule, etc.
• Informal application in other business functions
– Lack of documentation
– Mitigation challenges
– Need to apply standardized methods
– Need to strengthen enterprise/agency risk
Application Maturity
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• What risk?
– Mobility
– Safety
– Physical asset – performance risk
– Financial resource
– Human resource
– Political
– Regulatory
– Legal
Asset Management Application
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Risk Register
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Implementation
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Future Needs
• Formal governance
– Overarching strategy, including mitigation approach
– Roles and responsibilities
• Commitment
– Lack of bandwidth
– Liability concerns
• Other important resources to support implementation
– Formal training
– Risk communication
Organizational Culture
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Data
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Value – availability, usability, quality
Completeness
Applicability
Need for additional/explicit risk measures
– Perceived consequence – event outcome
– Perceived desirability – risk tolerance
Risk Measures
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Resource Guides
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Summary
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Application
Maturity
• Strong foundation at the project level
• Requires standardized methods
• Lack of capabilities and tools
• Implementation of mitigation strategies
Organizational
Culture
• Lack of buy-in
• Lack of commitment
• Resources for change
Data
• Data quality
• Data appropriateness and completeness
• Risk measures
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