A Logic-Based Risk Engineering Approach to Support the Decision-Making Process of Upstream Projects

2021 ◽  
Author(s):  
Roberto Vimercati ◽  
Filippo Fratoni ◽  
Karin Comploi ◽  
Mirko Petralia ◽  
Filippo Corvi ◽  
...  
Keyword(s):  
Decision Making ◽  
Risk Management ◽  
Cyber Security ◽  
Risk Mitigation ◽  
Energy Transition ◽  
Innovative Approach ◽  
Past Century ◽  
Project Risk ◽  
Business World ◽  
Risk Management Process

Abstract The exploration and production of hydrocarbons is undeniably a high-risk venture. Uncertainties are in every activity, from the exploration phase up to facilities construction and plants operation. To allow decision makers understanding the uncertainty associated with the decisions they were asked to face, in the 70ies of the past century, when the oil shockwaves upset the entire business world (Bood & Postma, 1997), it was introduced the use of scenario analysis. Since then, stochastic analyses, such as Monte Carlo simulations, started permeating the oil & gas world. Yet, as Lewis et al. (2004) highlighted, despite the benefit greatly outweighs the effort generally required to perform these analyses, managers not seldom refrained themselves from using these tools to support their decision-making processes. And this, as highlighted by Judah (2016), despite risk mitigation is the very core of the oil & gas business as risks at stake are many, namely: drilling risk, subsurface risk, cost & schedule risk, procurement risk, performance risk, health, safety, and environment (HSE) risk, geopolitical risk, and price risk. Today, the energy transition is imposing new challenges to the oil & gas sector. Even amongst those companies that have embraced (quantitative) structured approaches to support their investment decisions, there is another challenge to face: the integration of all risks in one approach capable of capturing the overall complexity of oil & gas projects and highlighting the effects of variations of both endogenous and exogenous risks on the overall profitability of the opportunity at stake (or the portfolio of opportunities). Risks are typically assessed separately by each function with different quantitative approaches that leave grey zones of interpretation where inter-functional risks can grow and create decisional inefficiencies. Aware of this, Eni integrated risk management, started last year a project aimed at enhancing the project risk management process. The innovative approach followed leverages on artificial logic and allows to consider the full life cycle of an investment proposal. In line with the evolution of company's mission and vision, the aim was to assess the project risk in a more comprehensive way by considering endogenous risks (such as permits, drilling, engineering, procurement, construction) jointly with exogenous ones (such as climate change, cyber security, credit, and country). The manuscript explains the methodology used, the results achieved, and the expected benefit for the company in adopting the innovative approach to risk engineering in supporting investments decisions.

Wildfire Communication and Climate Risk Mitigation

2017 ◽  
Author(s):  
Robyn S. Wilson ◽  
Sarah M. McCaffrey ◽  
Eric Toman
Keyword(s):  
Decision Making ◽  
Risk Management ◽  
Private Property ◽  
Risk Mitigation ◽  
Strategic Communication ◽  
Management Tool ◽  
Wildfire Risk ◽  
The Public ◽  
Resource Managers ◽  
Risk Management Process

Throughout the late 19th century and most of the 20th century, risks associated with wildfire were addressed by suppressing fires as quickly as possible. However, by the 1960s, it became clear that fire exclusion policies were having adverse effects on ecological health, as well as contributing to larger and more damaging wildfires over time. Although federal fire policy has changed to allow fire to be used as a management tool on the landscape, this change has been slow to take place, while the number of people living in high-risk wildland–urban interface communities continues to increase. Under a variety of climate scenarios, in particular for states in the western United States, it is expected that the frequency and severity of fires will continue to increase, posing even greater risks to local communities and regional economies.Resource managers and public safety officials are increasingly aware of the need for strategic communication to both encourage appropriate risk mitigation behavior at the household level, as well as build continued public support for the use of fire as a management tool aimed at reducing future wildfire risk. Household decision making encompasses both proactively engaging in risk mitigation activities on private property, as well as taking appropriate action during a wildfire event to protect personal safety. Very little research has directly explored the connection between climate-related beliefs, wildfire risk perception, and action; however, the limited existing research suggests that climate-related beliefs have little direct effect on wildfire-related action. Instead, action appears to depend on understanding the benefits of different mitigation actions and in engaging the public in interactive, participatory communication programs that build trust between the public and natural resource managers. A relatively new line of research focuses on resource managers as critical decision makers in the risk management process, pointing to the need to thoughtfully engage audiences other than the lay public to improve risk management.Ultimately, improving the decision making of both the public and managers charged with mitigating the risks associated with wildfire can be achieved by carefully addressing several common themes from the literature. These themes are to (1) promote increased efficacy through interactive learning, (2) build trust and capacity through social interaction, (3) account for behavioral constraints and barriers to action, and (4) facilitate thoughtful consideration of risk-benefit tradeoffs. Careful attention to these challenges will improve the likelihood of successfully managing the increasing risks that wildfire poses to the public and ecosystems alike in a changing climate.

Design Thinking as a Tool for the Analysis of Project Risks

2019 ◽  
Vol 16 (6) ◽  
pp. 60-77
Author(s):  
E. V. Vasilieva ◽  
T. V. Gaibova
Keyword(s):  
Risk Management ◽  
Risk Analysis ◽  
Design Thinking ◽  
Management Tools ◽  
Project Risk ◽  
Team Members ◽  
Investment Projects ◽  
Risk Management Process ◽  
Project Objectives ◽  
Project Risk Analysis

This paper describes the method of project risk analysis based on design thinking and explores the possibility of its application for industrial investment projects. Traditional and suggested approaches to project risk management have been compared. Several risk analysis artifacts have been added to the standard list of artifacts. An iterative procedure for the formation of risk analysis artifacts has been developed, with the purpose of integrating the risk management process into strategic and prompt decision-making during project management. A list of tools at each stage of design thinking for risk management within the framework of real investment projects has been proposed. The suggested technology helps to determine project objectives and content and adapt them in regards to possible; as well as to implement measures aimed at reducing these risks, to increase productivity of the existing risk assessment and risk management tools, to organize effective cooperation between project team members, and to promote accumulation of knowledge about the project during its development and implementation.The authors declare no conflict of interest.

Customisable framework for project risk management

2017 ◽  
Vol 17 (1) ◽  
pp. 68-89 ◽  
Author(s):  
Jennifer Firmenich
Keyword(s):  
Risk Management ◽  
Management Practices ◽  
New Institutional Economics ◽  
Future Research ◽  
Project Risk Management ◽  
Management Process ◽  
Project Risk ◽  
Content Type ◽  
Risk Management Process ◽  
Management Concepts

Purpose The purpose of this paper is to emphasise on the need for efficient and effective project risk management practices and to support project managers in increasing the cost certainty of projects by proposing a new framework for project risk management. Design/methodology/approach The author adopts a “constructivist” methodology, drawing on practices common in construction management sciences and new institutional economics. Findings The author presents a holistic and customisable project risk management framework that is grounded in both practice and academia. The framework is holistic because, amongst others, all steps of the typical risk management process are addressed. The framework is customisable, because it allows for alternative ways of implementing the project risk management steps depending on the project-specific circumstances. Research limitations/implications The framework does not address the potential unwillingness of the project players to set up a project risk management process, at all. The proposed framework has not yet been tested empirically. Future research will seek to validate the framework. Originality/value The framework is designed to account for the difficult circumstances of a complex construction project. It is intended to support decision makers in customising a practical yet comprehensive project risk management concept to the characteristics of the unique project. Although many other project risk management concepts are designed based on the assumption that actors are perfectly rational and informed, this framework’s design is based on the opposite assumption. The framework is dynamic and should adapt over time.

scholarly journals Exploring the Project Risk Management: Highlighting the Soft Side of Project Management

2021 ◽  
Author(s):  
Muhammad T. Hatamleh
Keyword(s):  
Risk Management ◽  
Project Management ◽  
Leadership Style ◽  
Risk Attitude ◽  
Management Process ◽  
Participative Leadership ◽  
Project Risk ◽  
Analytical Skills ◽  
Risk Management Process ◽  
Process Groups

The majority of the approaches to managing project risk follow the logic of process groups. Project Management Institute (PMI) has 29 tools and techniques related to risk management process groups. Consequently, engineering and business schools have been accused of educating managers with sharp analytical skills but little understanding of social problems. The literature suggests that too much attention is focused on learning the techniques and formalities of risk management but not enough on the advanced issues of management. Also, the literature argues that there are two approaches to project management (hard and soft). The hard side only covers part of the managerial aspects which helps to manage foreseeable uncertainties. However, unforeseeable uncertainties need skills that related to soft side approaches such as emotional intelligence, navigating the organization’s culture, risk attitude, participative leadership style, and managing the relationship with stakeholders. This study provides an intensive review of the literature to discuss the need for integrating the hard and soft sides of management to achieve an effective risk management process. In addition, it proposes a conceptual framework that provides guidelines to enhance overall risk management efficiency.

scholarly journals Impact of Quality Risk Management Process in Pharmaceutical Industry to Curtail the Non Conformity

2013 ◽  
Vol 11 (01) ◽  
pp. 74-82
Author(s):  
Aachchhadita Sharma ◽  
Raju Mari Jeyaprakash ◽  
Raju Mari Jeyaprakash ◽  
Rinchi Bora ◽  
Abinash Chandra
Keyword(s):  
Risk Management ◽  
Risk Mitigation ◽  
Drug Product ◽  
Management Process ◽  
Ground Rule ◽  
Quality Risk Management ◽  
Risk Management Process ◽  
Regulatory Bodies ◽  
Quality Risk ◽  
Risk Scale

Risk is intertwined with every drug product in a market. This article’s intent is to provide ground rule and praxis of different tools for Quality Risk Management (QRM) in various aspects of pharmaceutical science. QRM comprises of tools and processes which helps in establishing objectives. Hence they are also known as Enablers. Enablers help in risk mitigation of product quality throughout a lifecycle in such a way that benefit outweighs the risk. The key properties of Enablers or QRM, i.e., attempts made, solemnness and records shall be compatible with risk scale. The Enablers accomplishment gives recognized, obvious and steps of Enabler process produced by regeneratable methods which is based on customary comprehension to evaluate feasibility, ability to find out risk prejudice. The QRM or Enabler tools can assist the manufacturing company and regulatory bodies to scrutinize, handle, notify, and inspect the risk.

Cyber risk management in SMEs: insights from industry surveys

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Felicitas Hoppe ◽  
Nadine Gatzert ◽  
Petra Gruner
Keyword(s):  
Risk Management ◽  
Cyber Security ◽  
Future Research ◽  
Management Process ◽  
Content Type ◽  
Security Culture ◽  
Current State ◽  
Enterprise Risk ◽  
Risk Management Process ◽  
Cyber Risk

PurposeThis article aims to gain insights on the current state of small- and medium-sized enterprises’ (SMEs’) cyber risk management process and to derive future research directions.Design/methodology/approachThis is done by collecting market insights from 37 recent industry surveys and structuring them based on the steps of the risk management process. From this analysis, major challenges are derived and future fields of research identified.FindingsThe results indicate that deficiencies in risk culture as well as the strained market for IT experts are the major obstacles with respect to the implementation of cyber risk management in SMEs, and that these challenges are similar across countries. The findings suggest that especially the relationship between cyber security culture and cyber risk management should be investigated further, and that a stronger link between the research streams on enterprise risk management and cyber risk management would be desirable.Originality/valueThis paper contributes to the literature by providing a systematic overview on the current state of SMEs' cyber risk management from a market perspective. The findings provide support for the existing academic literature by emphasizing the central role of cyber security culture (perception, knowledge, attitude) for a successful cyber risk management, which however should be addressed in more depth in future (empirical) research.

Project Risk Management Process for Professionals

2018 ◽  
pp. 277-299
Author(s):  
Tamas Toth ◽  
Zoltan Sebestyen
Keyword(s):  
Risk Assessment ◽  
Risk Management ◽  
Risk Category ◽  
Project Risk ◽  
Risk Management Process ◽  
Minimum Requirements ◽  
Integrated Project ◽  
Assessment Procedures ◽  
Project Risk Analysis ◽  
Project Risk Assessment

This chapter will provide an instantly applicable integrated project risk analysis method, which tracks the probabilities of the occurrences of harmful events perceived by the owners from the conceptual phase to the end of the project. The chapter follows a threefold structure. First, the paper provides a revised integrated project risk assessment framework that enhances conventional risk category-based methods. Second, the minimum requirements of the owners are clarified to attain the main goal of project risk assessment and to identify the harmful events jeopardizing this goal. Third, the widely known risk assessment procedures are revised, and a methodology for taking and selecting proper risks is provided. Finally, a new valuation approach to the monitoring phase is introduced, which is able to capture the current market value of the project based on the risk management and controlling system's data.

The Rigorous Security Risk Management Model

2018 ◽  
pp. 1299-1317
Author(s):  
Neila Rjaibi ◽  
Latifa Ben Arfa Rabai
Keyword(s):  
Risk Management ◽  
Cyber Security ◽  
Linear Models ◽  
Management Model ◽  
Security Risk ◽  
Security Threat ◽  
Risk Management Process ◽  
Failure Cost ◽  
The Mean ◽  
Security Risk Management

This chapter presents the security concepts terminologies (threat, risk, security risk management, security risk management process, security threat model) and present the state of the art of security risk management models, compare and discuss strengths and weaknesses of such models. Then it presents the Mean Failure Cost (MFC) model for quantifying security threats as a rigorous measure of cyber security, and as a cascade of linear models in order to estimate the system security using the loss of a given stakeholders as a result of security breakdown. Finally it presents an overview of the applicability of the MFC measure to e-systems. In the conclusion, the chapter criticizes the MFC Cyber Security Measure and presents an overview of different perspectives.

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