What is Risk Assessment and Why it

is so Useful On Board ?
Written by Capt Bhupender Singh Banga on October 17, 2016

Many believe risk assessment is quite boring subject and has nothing
to do with reality on board ships.

Some also believe it is all about documenting risk assessment form

proving that risk assessment is carried out. But in realty, risk
assessment is not only about creating huge amount of paper work. It
is rather about identifying sensible measures to control the risks in
your workplace.

Risk assessment is not a new thing. Its only that shipping industry is
taking it more seriously now.

A teacher teaches her students to cross a road. Use a zebra crossing,

first see towards your right, and then left…and so on. This is what risk
assessment is all about.
So how risk assessment applies to maritime industry and how we can
manage these risks to have safer maritime industry.

Let us discuss.

Risk Assessment as decision making tool

Everything in life has some risk. What you have to actually

learn to do is how to navigate it.

This quote from Reid Hoffman outlines what risk assessment is all
about. On board a ship, there are many hazards and these pose even
more risks. Risk assessment acts as a tool to manage these risks.

There are three main reasons as to why it is important to carry out risk
assessment.

1) because it financially beneficial as it helps to reduce the risk and

thus accidents
2) because it is regulatory requirement and thus legally required to
conduct risk assessment. Paragraph 1.2.2.2 of the ISM Code states,
“Safety management objectives of the company should …. assess all
identified risks to its ships, personnel and the environment and
establish appropriate safeguards”. This 2010 amendment to ISM code
has included the risk assessment explicitly.

3) because it is morally and ethically right thing to do as risk

assessment helps in preventing injuries and accidents.

Risk Assessment is a decision making tool. The use of risk

management techniques started from the Insurance industry. When
 the industry plans to insure a particular object, especially a new one,
they need to conduct a Risk Assessment.
This helped them to decide whether it is OK for the business to go
ahead with it. The hazards and risks involved decides the amount of
premium.

Even with maritime scenario, the whole purpose of the risk assessment
is to answer this question. “Will it be safe to go ahead with an
operation ?”

It was the year 1997 that marked a major step towards risk based
approach in the maritime field. This was the time when the Maritime
safety committee (MSC) and the Marine Environmental Protection
Committee (MEPC) of the IMO adopted the Interim Guidelines for the
Application of Formal Safety Assessment (FSA) to the IMO Rule-Making
Process.
Since then risk assessment has only been evolving and it has now
become a decision making tool at the ground level too.

How to conduct risk assessment

Various publications provide various guidelines regarding the steps for

risk assessments. The most widely accepted in shipping industry is the
5-step process.

1. Identification of Hazards
First step is to identify all the hazards. But to identify hazards we must
understand what a hazard is ? We sometimes get confused between
hazard and risk. These examples can simplify this.

 A ladder is a HAZARD which creates a RISK of falling

 Grease on deck is a HAZARD, slipping is a RISK

 A hammer is HAZARD, injuring your thumb is RISK

 Lack of oxygen is a HAZARD, Asphyxiation is a RISK

 Oily rags is a HAZARD which creates a RISK of fire

The use of the term ‘hazard’ originated in the nuclear and chemical
industries for which a wide range of different types of ‘hazards’ are
present all the time (e.g. nuclear material, flammable gases, toxic
chemicals etc.)

A hazard is a substance, situation or practice that has the potential to

cause harm. Risk is the Probability of the harm occurring (combined
with the consequence of the harm).
The hazard may be a physical situation such as fishing vessel because
it may collide with own vessel. It may be an activity like crane
operations because the load might drop. It may even be material such
as oily rag because it might catch fire.

In practice, the term “hazard” is often used for the combination of a

physical situation with particular circumstances that might lead to
harm. For example, a collision with fishing vessel, a dropped load or an
oily rag fire.
 Consider you are in a zoo. What is more RISKY, a tiger in a cage or the
same tiger outside the cage walking freely. Here the tiger is a
HAZARD, whether inside or outside the cage, but the probability of
causing harm, and hence the risk is more when the tiger is outside the
cage. Thus, the risk can change for the same hazard under different
circumstances.

It is difficult to declare completeness of a hazards identification

process, and hence hazard identification should be periodically
reviewed.

Risk assessment in general and Hazard identification in particular is a

team work.

2. Risk Estimation
Safety is related to the degree of absence of risk. Because no activity
is free of risk, an activity is considered safe when the level of risk is
within acceptable limits.

But how do we know if the risk is acceptable or not ? We should be

able to calculate the risk and we should know how much risk is
acceptable ? In short we should know how to calculate or estimate
risk.

IMO defines risk as ‘the combination of the frequency and the severity
of the consequence’ (MSC Circ 1023/MEPC Circ 392).  Here the
frequency is ‘the number of occurrences per unit time (e.g. per year)’
and consequence is ‘the outcome of an accident’.
In simple words, risk has two components:

 How likely is this to happen? – likelihood of occurrence (frequency)

 How bad would it be if this did happen? – severity of the consequences

We would need both the above components for estimating the Risk.

A reliable equipment would mean that there are lesser chances of it
breaking down. That is frequency (likelihood of occurrence) is low.

But to estimate the risk we also need to consider the severity of

consequences if the equipment fails.

We need to combine both these factor to get a fair estimation of risk

involved in using this equipment.

Traveling by a plane has far more severe consequences than traveling

by road. But the frequency and finally the risk as per statistics is far
less. But it is a matter of fact that the perception of risk is higher than
the actual risk in case of travel by a plane. This is perception of risk vs
actual risk.
Even though we think the risk for traveling by air is higher than
traveling by road, but still we travel by air. This is the basis of Risk
assessment and is called ‘As low as Reasonably Practicable’ or ALARP.
 If we go by road, there is some cost, time and effort involved. These
would be disproportionate to the benefits of risk reduction that we
would achieve.

So in deciding the practicability of how much risk reduction is enough,

we compare a hazard with three things.

 Cost

 time

 effort involved.

It is possible that we avoid traveling by air but it is not practicable

(Possibility vs Practicability). The fundamental principle of risk
management acknowledges that the risk cannot always be eliminated.

But it is possible to reduce them to a level that is ALARP. This is the

level where the risk is tolerable as reasonable practicable risk
reduction measures would be in place.

So we can estimate the risk by combining frequency and severity of

consequences.

This combination of Frequency and Severity of Consequence can be

done in many ways.

Each company may have different method which you will get in
company’s safety management manuals.

A company may decide to prepare a Risk Estimator matrix with

Likelihood and consequences on the y and x –axis respectively.
The likelihood and consequence is to be estimated with existing
controls in place and a resultant risk calculated from the matrix.

The company SMS should identify the level of risk for which additional
controls will be required before the job is started.

For example the company might decide that additional controls are
required if the risk level is Moderate or above as per below example of
risk matrix.

Another methodology is to give values to Frequency and Consequence

and then calculate the risk by Multiplying the two values i.e. Risk =
Frequency x Consequence.
Remember, the likelihood and consequence is to be estimated with
existing controls in place. The company SMS has to identify the Risk
value for which additional controls are required.

Few company SMSs recognizes that the risk depends more on

consequence than the frequency. In this case they calculate risk as
below:

Risk = Frequency x Consequence squared (F x C^2)

What method we need to follow to calculate the risk would depend

upon your company’s SMS.

3. Control the serious risks

This is the step in which we evaluate options for controlling the

estimated risks.
The principle of controlling the risk is simple. We should aim to remove
the risk. But even if we cannot remove it completely, we must reduce
it to as low as reasonably practicable (ALARP).

There are four way we can handle the identified risk.

i) Avoid the risk altogether
Not a likely option if the work or operation has to be completed. But
this may be necessary at times for safety.

For example in emergency if we have to abandon the ship in rough

weather, we cannot avoid it though it would be risky.

ii) Reduce the potential impact of the risk

This involves reducing either the likelihood (frequency) of a loss
occurring or the consequence (severity) or both. This can be
achieved by taking extra precautions.

When we take extra precautions, it is important to evaluate what is

decreasing. Likelihood, consequence or both.
Usually it is the likelihood that will decrease, as decreasing
consequence at times is not practical.

But there can be times when the consequence alone or both will

reduce. An example can be working aloft on a mast. Using a safety
harness will reduce the likelihood of falling down because if at all the
person falls, the consequence will be same. The consequence can be
reduced if we rig a net below the mast.

iii) Transfer the risk to another party

Not a common option for seafarers but can involve the use of
specialists or technicians. For example a contractual transfer of risk to
a third party by hiring a thir party to do the work.

iv) Retain the risk with no planning

Off course it is not the best option to retain the risk and proceed with
the work.

4) Identify benefits, implement action and establish

responsibility

Now that we have estimated and identified the steps to manage the
risk, it is time to implement these actions. We also need to establish
responsibilities for each identified actions to reduce risk.

5) Monitor the risks

During the course of work, many factors can change. It is important

that we continually monitor, review, evaluate and modify the first
three steps in the process.

We also need to document a feedback at the end of job. The

feedback should mention if the control measures taken for the job
were enough. This feedback then can be used next time similar job is
planned.
Type of Risk assessments

Formal and Informal Risk assessments

Formal risk assessment is done as a team. It starts with a meeting for
hazard identification, completing all steps and the process is usually
logged down in a specific form.

An informal risk assessment complements the formal process and is

not a replacement for formal risk assessment. It is usually done on an
individual basis for his daily work activities.

For example “Take 5″ and SLAM (Stop, Look, Assess and

Manage) techniques remind us to stop work if our health and safety is
at risk.
Qualitative Semi-Quantitative and Quantitative Risk
Assessments (QRA)
Qualitative risk assessment techniques uses simple methods to
evaluate risk. This does not need a high level of skill and can be
measured in non-numerical ways. An example is the risk matrix
generally used on board ships.

Quantitative risk assessment uses complex methods like special

software which precisely calculates the numerical value of risk.
This  requires high skill levels and knowledge of software or other
applications. The classification societies have developed software for
the use of highly hazardous operations.

Semi-quantitative risk assessment lies somewhere between the above

extremes. It uses numerical values to calculate risk but does not use
special techniques like a software or similar application.

For example if both the probability and severity can be quantified, the
risk is simply the product.

Risk = Probability x Severity.

On board ships we generally use qualitative techniques.

Conclusion

Risk assessment is no more an additional voluntary safety tool.

Shipping industry is becoming more and more serious to it. Following
any incident, the first question that is asked is “if the risk assessment
was carried out or not” ?

The effectiveness of risk assessment in reducing the risks depend upon

the seriousness with which it is carried out.