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Risk Management Systems (Sources of failures (They are internally…
Risk Management Systems
It Creates an uniform approach to the management of risks
Forms a common standards within a framework to tackle risks
This applies to both micro and macro level within an organization
Sources of failures
Hardware failure
Software failure
Human failure
Organizational failure
They are internally comprehensive and not necessarily independent of each other
These build the foundation to build a total risk management framework
My previous construction site experience
Source of failure
Organizational error
Caused by missing valuable data due to inadequate inspection
The level of soil excavation for footings was studied carelessly
Work proceeded up to fabrication and erection of reinforcements for footings
Hence, it caused major time and cost deficiency
This was an internal system failure
Emphasis was given on 'Technical Errors'
Yet, Organizational Error was the root of the problem
Effective knowledge management is instrumental in reducing the rates of these sources of failure
This could be obtained by setting up a proper functioning system in place
Eg. Using Project Management Consultants for Quality Control works and cross examining
Effective system helps to
Establish policies and objectives
Assess and review the effectiveness of procedure and practice
Achieve and maintain regulatory compliance
Provide a framework for consistent measurement and review of performance
answer these questions in decision making
What can be done and what options available?
What are the associated trade-offs?
What are the impact of current decisions on future options?
The ultimate purpose is to
Build an understanding of the system's nature
Improve the decision making process
Identify, quantify and evaluate risk within the framed system
References: Haimes Y. (2009) 'Risk Modeling, Assessment and Management', Section 1.3.4