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Operational Risk Management Provides Disaster Case Studies and Steps for Risk Prevention

Analysis of natural disasters, man-made accidents and terrorist acts identifies ten basic risk factors that underlie catastrophes.

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Operational Risk Management, by Mark D. Abkowitz, professor of civil and environmental engineering at Vanderbilt University.

The book contains 15 case studies of major disasters, including September 11, Hurricane Katrina and the losses of the Challenger and Columbia space shuttles. It also includes two success stories where major disasters were averted through careful planning, extraordinary communication and teamwork.

Through a detailed analysis of this combination of natural disasters, man-made accidents and terrorist acts, Abkowitz asks the question "Why did it happen?" and answers it by identifying ten basic risk factors that underlie various catastrophes, even those that are as different as major oil spills and devastating tsunamis.

Finally, the risk management expert points out a number of "lessons learned:" that individuals, companies and governments can apply to prevent many disasters from occurring and to better control the consequences of those that are unavoidable.

Risk Management

"Risks can be managed. It is just a matter of doing it the right way," Abkowitz said. "When you take a step back and take a holistic view, you see that there are a number of simple things that we can do that would substantially increase our safety and sense of well being."

The case studies investigate individual disasters in detail and often reveal surprising but little known details. For example, did you know that:

  • Several members of Al Qaeda who carried out the September 11 attack on the Trade Center were detained at security checkpoints yet still allowed to proceed with their operation;
  • Officials of the Soviet Union purposely kept the news of the nuclear reactor explosion at Chernobyl secret from the local population for 36 hours, exposing more than 100,000 people to high levels of radiation without their knowledge;
  • NASA officials allowed history to repeat itself when the space shuttle Columbia disintegrated upon reentry because they did not accept the recommendations made following the Challenge disaster when the shuttle broke up less than two minutes after launch;
  • Japanese officials allowed a terrorist group to operate under the guise of a religious organization, leading to an attack on the Tokyo subway system that killed 12 people and injured more than 5,000 others;
  • In 1989, on United Airlines flight 232, due to extraordinary communication and teamwork, the majority of the passengers and crew survived a crash so severe that they should all have perished.

Risk Management Factors That Cause & Solve Each Catastrophe

The motivation for the book came from a course on risk management that Abkowitz has taught for the last six years at Vanderbilt. In the class, students research and analyze specific disasters. They attempt to determine the factors that cause each catastrophe and identify steps that could have been taken to prevent or mitigate it.

As a result of this applied hindsight, Abkowitz has concluded that we can do a significantly better job of managing risk if we take an “all hazards” approach and focus on controlling the ten basic risk factors that he has identified.

Restructuring Risk Management Organization

"Today, we have overly compartmentalized the risks that we face," he said. "We have given responsibility for man-made accidents, intentional acts and natural disasters to different organizations. Each group has its own resources and priorities with only limited coordination despite the fact that these different categories of risk share many of the same risk factors and outcomes."

Although Abkowitz concluded that we can do a much better job of managing the risks that we face, he cautioned that it is impossible to create a risk-free society so we must also change our expectations.

Prioritizing Risk Management Attention and Resources

"We can do a much better job of prioritizing where to place our attention and resources, but this does not guarantee that those risks will be completely eliminated, nor does it mean that other risks considered less important will not cause occasional problems. So we need to accept that bad things can sometimes happen, learn from the experience and move on."

Vanderbilt University is a private research university that has 10 schools, a public policy institute, a distinguished medical center and The Freedom Forum First Amendment Center.

Edited by Carolyn Allen
| governance | leadership | risk management | disaster prevention |


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