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Q2. How effective are the current risk response plans and actions? If the risk plans are not
effective, modify them for better results.

A risk response plan is a document that explains the strategies that would be
taken to mitigate negative project risks. It’s part of the larger risk management
plan that is subsequently part of any project management plan. Before we
respond to risk, you have to identify it.

Risk response planning is the process of developing options and determining


actions to enhance opportunities and reduce threats to the project`s objectives. It
includes the identification and assignment of individuals or parties to take
responsibility for each agreed risk response. This process ensures that identified
risks are properly addressed. The effectiveness of response planning will directly
determine whether risk increases or decreases for the project.
Risk response planning must be appropriate to the severity of the risk, cost
effective in meeting the challenge, timely to be successful, realistic within the
project context, agreed upon by all parties involved, and owned by a responsible
person. Selecting the best risk response from several options is often required.

Project risks can impact that timeline and increase costs. The quicker we identify
them and resolve any issues that come up, the more likely we are to deliver a
successful project.

Types of Risk Response Strategies

Risk Response Strategies for Negative Risks (Threats)

1. Avoid: This risk response strategy is about removing the threat by any
means. That can mean changing your project management plan to avoid
the risk because it’s detrimental to the project.

2. Mitigate: Some project risks you just can’t avoid. Those you need to
mitigate, which is reducing the impact of the negative risk on the project.

3. Transfer: As the name implies, here you’ll transfer or pass the work on
resolving the project risk to a third party, such as buying insurance or
getting a warranty and guarantee.
4. Accept: This risk response strategy consists in identifying a risk and
documenting all the risk management information about it, but not taking
any action unless the risk occurs.

Risk Response Strategies for Positive Risks (Opportunities)

1. Exploit: When there’s a positive risk or opportunity you want to exploit you
need to add more tasks or change the management plan to take advantage
of it. There is risk inherent in this approach, but often the reward is worth
it.

2. Enhance: Here you increase the chance of a positive risk occurring in your
project.

3. Share: Here you’ll share the risk response with other partners across
various teams or projects. It might mean sharing a skilled team member
across various projects.

The effectiveness of current risk response plans and actions depends on a variety
of factors, including the nature of the risks being addressed, the resources
available to implement the plans, and the ability of the organization to adapt and
respond to changing circumstances.

In order to assess the effectiveness of risk response plans and actions, it is


important to conduct regular evaluations and reviews. This may involve collecting
feedback from stakeholders, analyzing data on risk incidents and response efforts,
and comparing outcomes against established goals and objectives.

If the risk response plans and actions are found to be ineffective, there are several
strategies that can be used to modify them for better results. Here are some
examples:
1. Review and Update Risk Assessments: One of the main reasons that risk
response plans may be ineffective is that the underlying risk assessments
are outdated or inaccurate. By conducting regular reviews and updates of
risk assessments, organizations can ensure that they are identifying and
prioritizing the most significant risks and that their response plans are
appropriately targeted.

2. Enhance Communication and Coordination: Effective risk response plans


require strong communication and coordination among all stakeholders. If
communication breakdowns or coordination challenges are hindering the
effectiveness of response plans, organizations may need to develop new
communication protocols, establish clearer lines of authority, or provide
additional training to staff.

3. Invest in Resources and Technology: In some cases, the effectiveness of risk


response plans may be limited by a lack of resources or outdated
technology. By investing in new resources and technology, such as
emergency response equipment, data analytics tools, or communication
systems, organizations can improve their ability to respond to risks
effectively.

4. Incorporate Lessons Learned: When risk response plans are not effective, it
is important to learn from the experience and make improvements for the
future. By conducting after-action reviews and incorporating lessons
learned into future planning and response efforts, organizations can
continually refine their risk response plans for better results.

In conclusion, the effectiveness of current risk response plans and actions can
vary depending on a range of factors. Regular evaluations and reviews can help to
identify areas for improvement, and organizations can modify their plans and
actions using a range of strategies, including reviewing and updating risk
assessments, enhancing communication and coordination, investing in resources
and technology, and incorporating lessons learned. By continually refining their
risk response plans, organizations can improve their resilience and reduce the
impact of risks on their operations and stakeholders.
Q3. Disaster risk reduction is related to cost- benefit analysis and limitations in risk
management. Can we rank the different amounts of risk for the different hazards; to see
which hazard causes the largest annual average damage, by how much is it possible to reduce
risk and how costly is it?

Disaster risk reduction is a complex and multifaceted field that is closely related
to cost-benefit analysis and limitations in risk management. In order to effectively
reduce risk, it is important to understand the different types and amounts of risk
associated with various hazards, as well as the potential costs and benefits of
different risk reduction strategies.

One important aspect of disaster risk reduction is the ability to rank different
hazards according to the amount of risk they pose. This can be done using a
variety of methods, including statistical analysis, historical data, and expert
opinions. By ranking hazards according to their relative risk, policymakers and
decision-makers can prioritize their efforts and allocate resources more
effectively.

In addition to ranking hazards, it is also important to understand the annual


average damage associated with each hazard. This can help policymakers and
decision-makers to understand the potential economic impact of different
hazards, and to prioritize risk reduction strategies accordingly. For example, a
hazard that causes a large amount of annual average damage may be a higher
priority for risk reduction efforts than a hazard that causes relatively little
damage.

Once hazards have been ranked and the annual average damage associated with
each hazard has been determined, it is possible to estimate how much risk can be
reduced and how costly it will be to do so. This can be done using cost-benefit
analysis, which involves weighing the costs and benefits of different risk reduction
strategies in order to determine the most effective and efficient approach.

There are a number of different risk reduction strategies that can be employed,
depending on the nature of the hazard and the resources available. These may
include structural measures such as building seawalls and flood barriers, non-
structural measures such as early warning systems and evacuation plans, and
policy measures such as zoning regulations and land-use planning. By considering
a range of different strategies and weighing their costs and benefits, policymakers
and decision-makers can determine the most effective and efficient way to
reduce risk.

However, there are also limitations to risk management that must be taken into
account. For example, there may be natural hazards that are difficult or
impossible to mitigate completely, such as earthquakes or hurricanes. In these
cases, risk reduction strategies may focus on minimizing the impact of the hazard
rather than eliminating it entirely.

Additionally, there may be limits to the amount of resources that can be allocated
to risk reduction efforts, particularly in low-income or developing countries. In
these cases, it may be necessary to prioritize risk reduction strategies based on
their cost-effectiveness and the potential benefits they offer.

How do we measure disaster risk?

Identifying, assessing and understanding disaster risk is critical to reducing it.

We can measure disaster risk by analysing trends of, for instance, previous
disaster losses. These trends can help us to gauge whether disaster risk reduction
is being effective. We can also estimate future losses by conducting a risk
assessment.

A comprehensive risk assessment considers the full range of potential disaster


events and their underlying drivers and uncertainties. It can start with the analysis
of historical events as well as incorporating forward-looking perspectives,
integrating the anticipated impacts of phenomena that are altering historical
trends, such as climate change. In addition, risk assessment may consider rare
events that lie outside projections of future hazards but that, based on scientific
knowledge, could occur. Anticipating rare events requires a range of information
and interdisciplinary findings, along with scenario building and simulations, which
can be supplemented by expertise from a wide range of disciplines.
Data on hazards, exposures, vulnerabilities and losses enhance the accuracy of
risk assessment, contributing to more effective measures to prevent, prepare for
and financially manage disaster risk. Modern approaches to risk
assessment include risk modelling, which came into being when computational
resources became more powerful and available. Risk models allow us to simulate
the outcomes and likelihood of different events.

Risk assessments are produced in order to estimate possible economic,


infrastructure, and social impacts arising from a particular hazard or multiple
hazards. The components of assessing risk (and the associated losses) include:

 Hazard is defined as the probability of experiencing a certain intensity of


hazard (eg. Earthquake, cyclone etc) at a specific location and is usually
determined by an historical or user-defined scenario, probabilistic hazard
assessment, or other method. Some hazard modules can include secondary
perils (such as soil liquefaction or fires caused by earthquakes, or storm
surge associated with a cyclone).

 Exposure represents the stock of property and infrastructure exposed to a


hazard, and it can include socioeconomic factors.

 Vulnerability accounts for the susceptibility to damage of the assets


exposed to the forces generated by the hazard. Fragility and vulnerability
functions estimate the damage ratio and consequent loss respectively,
and/or the social cost (e.g., number of injured, homeless, and killed)
generated by a hazard, according to a specified exposure.

The technical guidance further provides specific recommendations on how to


comprehensively assess risks and reduce and/or address them through planning.
It follows the general workflow for risk assessments from International
Organization for Standardization standard 31000 with its main phases of scoping,
risk identification, risk analysis and risk evaluation:
1. A good scoping phase means to design a risk assessment in such a way that
it supports decision-making and planning by taking into account existing
objectives, goals, values, and the existing policy and planning framework.

2. Risk identification aims to identify relevant risks starting from existing


knowledge and expert input.

3. In risk analysis, the risk components (hazards, exposure and vulnerabilities)


and their interlinkages, resulting cascading impacts and the potential for
adverse consequences for selected human or ecological systems are
explored and analysed using quantitative and qualitative methods.

4. Risk evaluation then identifies urgent actions and risk reduction measures
based on the levels of risk tolerability defined by the communities and key
stakeholders.

Risk can be assessed both deterministically (single or few scenarios) and


probabilistically (the likelihood of all possible events). Probabilistic models
“complete” historical records by reproducing the physics of the phenomena and
recreating the intensity of a large number of synthetic (computer-generated)
events. As such, they provide a more comprehensive picture of the full spectrum
of future risks than is possible with historical data. While the scientific data and
knowledge used for modelling is still incomplete, provided that their inherent
uncertainty is recognised, these models can provide guidance on the likely 'order
of magnitude' of risks.

Risk models are a representation of reality, but are only as good as the data used.

The convergence of public and private sector risk modelling efforts promises to
increase the availability of open access, open source risk information that can be
used by business, government, insurance and citizens alike. However, while the
experts developing these models clearly understand their limitations, especially at
subnational levels, DRR practitioners using the information produced by these
models may understand these limitations less well.

Though important challenges remain in assessing risk, more hazard data and
models are available; tools and models for identifying, analysing, and managing
risk have grown in number and utility; and risk data and tools are increasingly
being made freely available to users as part of a larger global trend towards open
data. More generally, and in contrast to 2005, today there is a deeper
understanding—on the part of governments as well as development
institutions—that risk must be managed on an ongoing basis, and that disaster
risk management requires many partners working cooperatively and sharing
information.

The matrix below is part of a process to assess risk severity of specific hazards. It
involves multiplying the likelihood score (1-5) by the impact score (1-5) to obtain
a final risk score (1-25) for each hazard. The risk level can then be categorized
based on the final score. For more information see here, "Strengthening risk
analysis for humanitarian planning".
In conclusion, disaster risk reduction is closely related to cost-benefit analysis and
limitations in risk management. By ranking hazards according to their relative risk
and estimating the annual average damage associated with each hazard, it is
possible to determine the most effective and efficient way to reduce risk.
However, there are also limitations to risk management that must be taken into
account, and it may be necessary to prioritize risk reduction strategies based on
their cost-effectiveness and the potential benefits they offer. By taking a holistic
and integrated approach to risk management, we can build more resilient and
sustainable communities that are better able to prepare for and respond to
emergencies and disasters.
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