When we talk about residual risk we are actually talking about the degree of exposure after we have implemented the agreed mitigation.
In essence we are accepting that even after the mitigation has been applied there is still the possibility of sufficient risk to pose a degree of threat.
You may see a formula to calculate residual risk is (inherent risk) x (control risk) where inherent risk is (threats × vulnerability). However consider in an environment which is extremely subjective the use of such formula’s may in fact be somewhat misleading. However it is important to have a structured process of analysis and to fully document the risk management process so that it may be reviewed, referred to whenever necessary and also audited for compliance with the company standard.
The challenge is in fact determining if the planned or proposed mitigation is sufficient for the required purpose if it is not then additional measures are required.
The Accountable Manager (AM) and the Post holders (PH) should have a comprehensive understanding regarding the risks the organisation faces, they are in fact not just responsible for the organisations safety but also for its business viability. Ultimately the organisation will determine the acceptability of both the proposed mitigation and the acceptance of the residual risk, It is for this reason that the business area owner or post holder MUST be highly involved in the decision making process.
The methodology applied to residual risk analysis is the same as that which is normally used within our organisation (means it is not a uniquely separate process).
We talk about a level of safety being As Low as Reasonably Practical (ALARP) and this is a typical example scenario where such decisions and acceptances have to be made. Often such decisions have to be balanced against budgetary constraints.
It may in fact occur after analysis that the cost of mitigating the risk is actually in excess of the exposure which is perceived, in which case we need to ensure that the management have thoroughly evaluated the exposure formally accept this risk.
It is also sometimes possible to transfer the risks to a third party in the form of insurance (note that insurance does not reduce the risk or exposure only mitigates the financial burden to the organisation.
Sofema Aviation Services offers multiple Safety Related Training Courses, please see www.sassofia.com for details or email office@sassofia.com
Tags:
Accountable Manager, Aviation Safety, Post Holder, Risk Management
