Engineering risk management

Engineering risk management, written by Thierry Meyer and Genserik Reniers, suggests that risk management (RM) will be described with applications in engineering. The cover presents the dilemma where risk is involved. The title and cover arouse the quest for an introduction to the risk management principles, definition of the scope in terms of engineering and examples of failures and successes of taking a risk. Thus, the book is to present risk management from an engineering perspective to university students as well as young professionals in industry.

The book is divided into twelve chapters. It lacks a preface and begins with a chapter titled ‘Risk management is not only a matter of financial risk’. Authors start with informing the reader that the book is concerned with learning how to take care of a company’s well-being through engineering risk management (ERM). It is implied that worst case scenarios will be the core of the risk considered, abstaining from the discussion of economy based financial RM. Brief historical proofs for the applications of RM is given. Early mentioned and later defined systemic approach is to be pursued while adhering to the engineering reality. The authors conclude that the book will help anyone in making the right decisions in life and in business.

The second chapter of the book presents an introduction to engineering and managing risks, along with its constituents. Three types of possible uncertainties are defined. Simplified interpretation of risk, based on hazard, exposure and loss, is provided through a simple multiplication of frequency and severity of unwanted event. ERM can be pursued by following several frameworks presented. The authors stress that it is important to take into account a human perception factor and suggest that the awareness should be as high as possible in dealing with RM.

Chapter 3 and 4 constitute the heart of the book; RM principles and analysis are described. A simplified overview of RM process is given in Chapter 3, where risk assessment consists of identifying, analyzing and evaluating the risks. The authors suggest the adaptation of integrated RM system on a holistic level. Several RM models such as Egyptian and Mayan pyramids, the P2T model, the Swiss cheese model and domino theory are described. The location of an accident and its role within the given models is situated. Next follows the ‘anatomy’ of an accident, where authors introduce the concept of independent protection layers (IPL). The latter are used in the current chemical facilities processing dangerous substances to diminish the effect of an undesired event. Types of risks as individual and societal are presented and followed by a discussion on physical description of risk. Next, safety culture and safety climate is brought as an intersection point within P2T model to show the role of individual within the organization’s healthy state. An ideal safety and security model is described by planting P2T within Plan-Do-Check-Act scheme. The authors suggest that every company should define its own safety and security sub-dimensions, which are eventually used to develop management safety and security indicators and objectives, and operational safety and security indicators and objectives.

Chapter 4 addresses the way risk can be assessed. Four most constituting techniques to risk analysis such as hazard and operability studies (HAZOP), failure mode and effects analysis (FMEA), or failure mode, effects and criticality analysis (FMCEA), and what-if analysis and the risk matrix are described. In addition-most used risk assessment techniques such as tree analysis, fault tree analysis, human reliability analysis and check lists are presented. The authors categorize available techniques into semi-empirical and logical subcategories. The chapter gives general flavor and starting point for risk analysis, implementer will have to address to a more detailed description of the methods and to choose the one most suited for his field. Next, methods that could be used in risk assessment of a project on every stage of its development, from conception to pre-production, are presented. The authors summarize general process for all analytical techniques presenting what steps should be taken to assess the risk, and additional steps needed in general risk analysis procedure. Chapter 5 is about risk reduction, prevention, mitigation, treatment and control. Corresponding frameworks/schemes and occasional examples are given for every action towards the risk. The STOP (strategic, technical, organizational and personal measures) principle is introduced with the aim to present a solution to safety problems. The authors suggest that a risk reduction procedure should be included in a cost-benefit analysis due to its high importance.

In chapter 6 several analytical procedures are provided to evaluate the event. It is stressed that near-misses should be treated as potential accidents and the quest for the source leading to a possible accident is motivated. Example of building the analytical scheme and the prevention/action plan is given. Chapter 7 covers the ‘life’ of crisis and its management. Important aspects of crisis management such as anticipation, preparation, treatment and finally memorization are described. Crisis evolution is described with the basis of Katrina Hurricane as an example. Authors stress that upon the occurrence of the crisis the circumstances change rapidly, and despite the complicated situations, communication among parties involved should be maintained open, and solutions benefiting everyone should be sought.

Chapter 8 briefly describes economic issues associated with safety. Accident costs and benefits are differentiated and related analogy used in calculations is presented. Prevention costs and benefits are followed by the discussion on the cost-benefit analysis of safety measures. Consequently, safety budget allocation strategy is presented. Authors suggest spreading the safety budget over different types of safety measures rather than investing on one type of safety measure only.

Chapter 9 looks at the issue of the risk governance within the organization. The authors state that risk governance requires dealing with risks and uncertainties in a holistic and open way. Necessary requirements for a successful risk governance, such as presence of RM system, framework for risk and uncertainty governance and the risk governance model are discussed.

Practical implementation of risk management is exemplified in chapter 10. The authors describe MICE concept that consists of four steps, management, information (education), control and emergency steps. Applications of the RM to chemistry and physics research along with applications to emerging technologies are presented. The book is concluded by examples of major industrial accidents and concluding remarks. The authors include the phenomenon described by Kahneman and Tversky, who observed that people tend to be risk averse for gains and risk taking for losses. This among other factors have to be taken into account while deciding on the safety measures in engineering risk management.

While chemical engineers can easily relate and benefit from the contents of the book, engineers involved in other fields may find it difficult to apply presented information in designing safe processes. Consequently, an alternative title for the book could be Introduction to Chemical Engineering Risk Management. Moreover, the book could be better structured if divided into three parts, such as introduction to ERM, principles of risk assessment, management, governance and reduction, and finally analysis of event, crisis and dealing with consequences (giving the examples). Some abbreviations of terms could be presented in the open form within the table of contents to add to clarity. Besides, the titles of chapters are of different formats, making it difficult to understand the sequence of presentation. Illustrations included throughout the book are descriptive and informative, although sometimes lacking some necessary information on the axis labels or figure captions. Although the book gives a good introduction, it should be treated as a starting point for search of an appropriate scheme to be applied within a specific organization.