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Functional safety Engineering - Principles of Risk Management Principle of Risk Management Risk Definition Measuring Risk Risk Tolerance Risk Reduction Safety Lifecycle and Risk Hazard Analysis Consequence and Likelihood What is Risk ? What is Risk ? Risk is a measure of the likelihood and consequence of an unwanted happening. How often can it happened and what will be the effect (consequence) if it does ? Risk receptors/Impact Personnel Environment Financial Equipment/property damage Business Interruption Business Liability Company Image Lost Market Share Why does companies manage risk ? Companies have a legal, moral and financial obligation to limit risk posed by their operation. Understanding the way this is expressed in a company helps to develop safety policy consistent with the way that company already works. Risk reduction: General concepts “Other technology safety-related system” Other technology safety-related systems are safety related systems based on a technology other than electrical/electronic/programmable electronic Example A relief valve is another technology safety-related system “External risk reduction facility” External risk reduction facility are those measures to reduce or mitigate the risks which are separate and distinct from, and do not use, E/E/PE safety-related systems or other technology safety-related systems Example A drain system, a fire wall and a bund are all external risk reduction facilities Key terms and concepts “Risk” Basis for Risk Tolerance Risky activities are tolerated because they provide benefits Understanding both the risk and the benefits is critical to understanding what kind of risk can be tolerated in trade for what kind of benefits. There is no such thing as zero risk in the real world. Measure Risk and Benefits Both risk and benefits must be measured to intelligently determine what to do in virtually any situation Risk measurement must address both consequence and likelihood The consequence usually invol
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