Moving Beyond Map-21: Risk Management · ASSET RISK REGISTER – FIRST THINGS FIRST Identify the level at which you want to track risks. To help determine the level, consider the

FTA Transit Asset Management Multimodal Roundtable July 2019

MOVING BEYOND MAP-21:

RISK MANAGEMENT

Presented by: Teresa Ray: MARTA

Kristyl Horton: BART

WHAT IS RISK?

Simply put, risk is the possibility

of something bad occurring.

ASSET RISK

What are the top risks to your house right now? Did you consider all of the following topics: Financial / Asset Loss Security Climate / Environmental Regulatory / Legal Health and Safety

How are you mitigating those risks? How are you monitoring the risks?

ASSET RISK REGISTER

Lists identified risks

Prioritizes/Scores risks

Determines a mitigation strategy

Identifies action items to mitigate (if any)

Designates individuals responsible for any action items

Establishes critical dates

Outlines method(s) of monitoring

..

ASSET RISK REGISTER

Lists identified risks Risk Log




Designates individuals responsible for any action items



ASSET RISK REGISTER – FIRST THINGS FIRST

Identify the level at which you want to track risks. To help determine the level,consider the following: Which assets/systems are critical to sustain the primary business: Reliably getting

customers safely from Point A to Point B If you wish to track risks via register beyond those assets/systems you should consider: How often the register will be updated Who is the intended audience Who will be updating the register Will there be more than one register

Conduct meetings with stakeholders for input Approval from steering committee Develop risk register / action log template (Google is your friend!)

sk An alysis

Refer t o "Risk M at ri x Instructions" Tab fo r Complet ion

Risk ID Dat e Identified Risk Own er Risk Des cript ion Biggest Ri sk Conse quence Risk Regime # Probability {1-5) Conse quence (1-5) Risk Score

ASSET RISK REGISTER: RISK LOG

I,

- 0 -, ' -...

IDENTIFY RISKS

Interviews Select key stakeholders Individual interviews Specific questions

Brainstorming Wider range of stakeholders Group meeting Less specific, but still leading questions

Checklist Previously identified risks

Tip: Create an intelligent Risk ID format standard. Consider a format that identifies the Office as part of the Risk ID.

For example, our Risk ID format is: RR-Office-YY-0000 RR = Risk Register Office is a 2 or 3 character standard abbreviation.

Example ID: RR-FAC-19-0005

The Risk ID immediately informs the viewer it’s a risk identified by Facilities in 2019.

IDENTIFY RISKS

Activity: Using the provided Asset Risk Register, identify a few risks you have at your

agency

~ .D RI

.D 0 .. c.. .:.: "' ii:

Very Hign

Hign

Moderate

Somewhat Low

Low

Insignifica nt

15

12

5

Minimal Moderate Severe Critical

Risk Impact

Moderate High

PRIORITIZE/SCORE RISKS: THE QUALIFIED HEAT MATRIX

Qualified Risk Score Pros

Good starting point!

Utilizes SME knowledge of level of risk probability and impact to score the risk

Cons Subjective

Not defensible in justifying capital project initiation

Does not eliminate lobbyist tactics

PRIORITIZE/SCORE RISKS: THE QUANTIFIED HEAT MATRIX

Quantified Risk Score Pros Provides pre-defined impact and probability rating criteria for each measure resulting in

a less subjective score

Defensible in justifying capital project initiation

Reduces lobbyist influence when prioritizing projects

Cons Requires more analysis and thus

More time

More individuals/business units involved

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0 A..

REGIMES

Very Hig h (5)

Hig h(4)

Moderate (3)

Low(2)

Minot"{l)

A.sset Management System Risk

Hedlth a ndl Enrvironmenta l Fina1noia l and Reputafional Regu latocy / Safety Im.pacts Asset Loss Damage Legal Im.pact

1 2 3 4 5

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Matrix

Quality of Service Service Im.Pact

6 7

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8

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<= 85:.: bYt > 80:.: Doto Qyolity KPI

R::,tirig

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R::,tirig

<= 35:.; bYt > 30:.: Doto Qyolity KPI

R::,tirig

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R ::, tirig

Si,g rn if&oa ml Rliisk

llmprobabl'e 11)

May occur once in over

10yea:rs

Evaluate

Alternatives (5)

Not L'kely to

OODur 12)

M CiYOCCl!Jrs oncein5to

10years

Aotion at N•� t Opportunllt,

(10)

Evaluate Alternatives

(8)

Evaluate

Alternatives (6)

PROBABILITY

Could OODur 13),

May occur once i n 1 to 5

years

1-diat• Action

(115)

Aotion at N•� t Opportunllt,

(12)

Evaluate

Alternatives (9)

Evaluate

Alternatives (6)

Known,to

OODur 14),

May occur once i n less than a year

Aotian at N•� t Opportu•lt,

(12)

Evaluate

Alternatives (8)

H i:g h, Rliisk

Common Ooourre;noe

1511

M a iY occ·ur fflOlfe than once in a

year

1m .. N1iat• Aotion (11)

AotionatU.� t Opportm1it1

c1•1

Evaluate

Alternatives (5)

PRIORITIZE/SCORE RISKS: THE QUANTIFIED HEAT MATRIX

IDENTIFY RISKS

Activity: Score your Risks using the Quantified Risk Assessment Heat Map

RISK REGISTER

Risk ID Date Identified Risk Owner Risk Description Biggest Risk Consequence Risk Regime # Probability (1-5) Consequence (1-5) Risk Score

RR-RCM-15-0001 5/1/2015 Doug Miller Rolls Royce APSE IGBT Gate Driver Board design deficiencies.

Excessive Repairs, Excessive Downtime, Financial 7 5 4 20

RR-RCM-15-0002 5/1/2015 Doug Miller Rolls Royce APSE GTO failures causing loss of component protections and increasing hazards risk to maintenance personnel.


RR-RCM-15-0003 5/1/2015 Doug Miller Main Battery End of Life failures causing cell overheating and excessive water consumption.


RR-RCM-17-0019 4/1/2017 Doug Miller PBG Assembly inadequate Power Design Excessive Downtime 7 5 2 10 RR-RCM-17-0020 4/1/2017 Doug Miller End of Life failures Excessive Downtime 7 2 2 4

RR-RCM-17-0023 4/1/2017 Doug Miller CQ312 Compressor Contactor End of Life failures Excessive Repairs, Excessive Downtime, Financial 7 5 3 15

RR-RCM-17-0024 4/1/2017 Doug Miller R-22 Obsolesence Excessive Repairs, Excessive Downtime, Financial 7 5 3 15 RR-RCM-17-0025 4/1/2017 Doug Miller Lighting Component End of Life failures Excessive Downtime 7 2 2 4 RR-RCM-17-0036 4/1/2017 Doug Miller BTE & PTE HW Obsolesence. Excessive Downtime 7 5 3 15

Risk Analysis Refer to "Risk Matrix Instructions" Tab for Completion

ASSET RISK REGISTER

Lists identified risks





Designates individuals responsible for any action items Action Plan


isk ID Risk Description Mit igat ion CIP Project ID Safety Haza rd Log ID Perform ance Constraints Imp acts Resource Prop osed Time Required Schedule Rep orti ng/M on itori ng Plan Plan Plan Notes

Measures Requirements Act ion Plan Req uirements Developer Approver Implementer

RISK REGISTER

DETERMINE A MITIGATION STRATEGY

The mitigation strategies you choose will be largely based upon the risk score and the risk tolerance of your Agency, Department, and/or Office.

Risk tolerance is defined by the Institute of Risk Management as “The amount and type of risk that an organization is willing to take in order to meet their strategic objectives.”

The four mitigation strategies are: Avoid

Reduce

Transfer – Outsource / Insurance

Accept

IDENTIFY ACTION ITEMS TO MITIGATE (IF ANY)

Dependent upon the mitigation strategy selected for a risk, you will need to decide what actions will be taken to address the risk.

Let’s say you have an elevator that was just put into service. It is discovered it’s getting utilized 3x as often as predicted. This is a risk and indicates the elevator will fail well before the estimated useful life. The options and actions to be assigned could be as follows:

Avoid – Shut the elevator down and replace all relevant parts with upgraded to ensure estimated life will be achieved and failures avoided

Reduce – Shorten time between inspections and preventive maintenance. Establish predictive maintenance as soon as trends allow

Transfer – Outsource maintenance of the elevator to 3rd party with insurance provisions for failure

Accept – Keep an eye on it but take no actions at that time

DESIGNATE INDIVIDUALS RESPONSIBLE FOR ANY ACTION ITEMS AS WELL AS CRITICAL DATES

When giving consideration to designating individuals responsible for any action items, you may opt to notate each of the following: Plan Developer

Plan Approver

Plan Implementer

This allows for a clear line of accountability.

OUTLINE METHOD(S) OF MONITORING

How will the risk be monitored going forward KPIs?

Increased unscheduled downtime

Increased scheduled downtime (more frequent PMI required)

Increased cost per hour/mile/gallon

Elevated customer complaints

Status Meetings

Future Risk Reassessment

ID Risk Description Mitigation Reason for Performance Proposed ime Require( Reporting/Monitoring Plan Plan Plan

Options Selected Option Measures Action Plan Requirements Developer Approver Implementer

Twice weekly track inspections,

1 Canterbury Diamond Crossover Switch ties Turnouts to be replaced in TR IV project. Bid monthly detailed switch inspections

Gauge Rods and Switch f asteninglreset, Slow MO\./ Rail Delays/ T&S Slow order currently being evaluated. Switch Ties have and twice yearly automated track

order Able to keep turnouts in acceptable state hour/miles been spotted in to mitigate the risk. 2years geometry inspections Ow ight Perkins Tim Elsberry Ow ight Perkins

2 Trk Circuits at Lindbergh, obselete parts. Purchase 1 time part order and implement

Purchase 1 time part order Quickest method to address MO\./ Rail Delays/ATC Trouble Calls Capital Project to replace. 2years RSCC Sup Log, ATC Trouble Call Data Addi Matthew Tim Elsberry Addi Matthew

3 T rk Circuits at Leno~, obselete parts. Purchase 1 time part order and implement


4 Trk Circuits at Brookhaven, obselete parts. Purchase 1 time part order and implement


5 T rk Circuits at Lakewood, obselete parts. Purchase 1 time part order and implement


6 Trk Circuits at Oakland City, obselete parts. Purchase 1 time part order and implement


7 Trk Circuits at \.Jest End, obselete parts. Purchase 1 time part order and implement


8 Trk Circuits at Sandy Springs, obselete parts. Purchase 1 time part order and implement

Purchase 1 time part order Quickest method to address MO\./ Rail Delays/ATC Trouble Calls Capital Project to replace. 2years RSCC Sup Log, ATC Trouble Call Data Addi Matthew Tim Elsberry Addi Matthew n ' <,• ' ,.

'

RISK REGISTER

-- - -

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---- ------ ----- --- --------------------- -------- ---------- --- -------- ----- --

Corporate objectives

AMP Policy

AMP Strategy

AMP Objectives

AM Plan

Work Execution

STRATEGIC RISK APPROACH SUPPORTS IAM & ISO55000 Strategic Asset Management is concerned with risk to your organizational objectives.

Strategic Plan Framework

Vis ion BART suppons a susta inable and prospe rous Bay Area by connecting communities with seamless mobility.

M ission Provide safe, re liable, d ea n, qu ality tra ns it servtce for riders.

le,idenhlp & Partflersltip In the Reg,on lnfras1:ructme & Servk e Org arn2at10n

ECONOMY

Can me 1Dtl-• regfcn 1s global

compe ver,15.'Si ~.,,m emnomic

o ppoP1:mirties..

ENGAGE COMMUNITY

Mop t~ O<tob.,, Z;l,. Z015

EQUITY

Prowdl! e-...i ..able del""'l' of mt'1sit s.ervice. paKlil!!'Si, Mid programs.

CONNECT llo CREATE

GREAT flACES

ENVIRONMEITT 6.dv.ini:e ~i<>Ml

'IU'rt..ainab· 1ty ond pub h• Ith

o.tJ..tmma.

ADVANCE

SUST AINAl!JUTY

EXPAND CAPACITY, MANAGE DEMAND

SYSTEM PERFORMANCE

OptlffllZ<" Q rn.amt,:un ~tcm parlonn.;.nce u, prall'.ido

roli.l~a. s,:de, co--t .-tte,:u'.l'C, cunam.cr ic,:a.m:d: scn,,.i,:c:

FIX. MAINT.l>.IN. & MODERN IZE

SAFE1Y ma

p.remer smty tulcure for owwor.,,,.., rid.,._ ond th• p,.,bl ·<..

WORKFORCE

lrwlH1: m DUI' 0.1Mfff1 ilod hltlil"II 11n1:plO'{CRl1

d anl.-, .uu:ld,.lll'UCJ

FIN.ANOAL 5TABl1JTY

Bullraa...,.,aT'l. ,....a: M1JI Lr'hfi ti a.q:ipan:

.iwruen~t.a:i• .MKI ,.,,11. ....

AJUGN WORKFORCE

WITH NEEDS

MODERNIZE BUSINESS. PRACTICES

THINKING BEYOND PHYSICAL ASSET RISK Strategic Asset Management is concerned with risk to your organizational objectives. For BART that’s our Strategic Plan Framework (BSPF):

& CREATE G EAT PLACES

ADVANCE

SUST AINAB IUTY

EXP'AJ\I D CAJPACITY, M.l1,NAGE OEMANO

I

FIX. MAINTAH'II.

& MODERNIZE

ALIG . 'If, r� RKFORCE

W ITH NEEDS

ODERNIZE B USINES.5 PRACTICES

IDENTIFYING STRATEGIC RISK – BALANCING PRIORITIES Although we are a transit agency, we also support other priorities. For example our BSPF Strategies include activities that address issues such as:

Homelessness

Sustainability

Transit Oriented Development

Art Program

? - Does your agency have competing priorities as well?

CO LJiJ ICAT IO NS

Med la 1Re1atbn:si

Ride" & Publtc

EXPERIENCE

Goals

Infrastructure & Service

SYSTEM PERFORMANCE

Optinu:. , ffi.M'IU&n i-~em p,ff'IOffl\M'Ke io ptOl'de

teh.a.bl•. u 1a <OC •ff«tn,. <t.Atotner fOCI.IWd ~•

UNICATltO N.S

- 1®19

� •... . ·· ..... ···'· ....

FINANOAL STABILITY

DEPARTMENT 4-YEAR WORKPLANS – DAY TO DAY GOALS AM Program performs outreach with all the BART departments to document their activities, align activities with the BSPF and understand the risks to accomplishing their objectives (D4YWP)

Day to day activities align with BSPF Goals:

Goll IFY2'H1o4111111

DEPARTMENT 4-YEAR WORKPLANS – STRATEGIC IMPROVEMENTS AM Program performs outreach with all the BART departments to document their activities, align activities with the BSPF and understand the risks to accomplishing their objectives (D4YWP)

Special projects (“Strategic Improvements or SI’s”) align with a cross functional BSPF Strategy owned by an Assistant General Manager

AM engages departments at the end of the fiscal year to record and communicate SI status

k i

IRi k

D4YWPS PROVIDE A PLATFORM TO IDENTIFY / RECORD RISKS Inquire regarding what keeps them from meeting their objectives. Stakeholders typically requests solutions, the Strategic Risk Register needs a problem statement & a description of what we’re “buying”

Help stakeholders describe the risk event with an if / then statement & identify multiple solutions into a Resource Request: If people fare evade then revenue is lost;

customers disgruntled; “bad actors” can compromise passenger or property security

Impacts BSPF Strategy Connect & Create Great Places: Will save X $$

If spare parts are not available from inventory then maintenance will be delayed causing reduced availability; passenger inconvenience; increased costs

Impacts BSPF Strategy Fix Maintain & Modernize: Will improve availability by X%

CREATING THE STRATEGIC RISK REGISTER The Strategic Risk Register records the department’s Resource Requests and the list is provided to executives for review. Executives have the opportunity to:

View all departmental resource requests & advocate / identify synergies

Perform outreach / ask questions about identified risks – especially when it impacts their resources

Escalate Resource Requests that mitigate the greatest risks

Notify AM Program of Resource Requests that should be invited to prepare a Business Case (White Paper) Due to the time required to prepare a business case

invites are kept to a minimum

INFORMING INVESTMENT DECISION MAKING The prioritized Strategic Risk Register and Business Cases are used by the General Manager during the budget process

Gives a ground up perspective on risks

AM advocates for risks that may be overlooked

Risks that receive treatment are followed up to track whether the desired results were achieved

Untreated risks are tracked and revisited on an annual basis

The Strategic Risk Register can be used by other departments such as Grants to find $$$

? – Is the Strategic Risk Register followed exactly? Of course not, but we’ve done our job to inform

decision makers of the highest risks

DOCUMENTING A STRATEGIC RISK REGISTER - OVERVIEW Asset Management coordinates with the Budget Department to create the Strategic Risk Register and integrate identified risks into the budget process:

BART Strategic Plan

Department 4-Year Work Plans

Strategic Risk Register

Annual Budget • Driven by 4 Year

• Highest priority

• BART Mission & Vision

Priorities • Annual Progress

Report to Board • Public Facing

Adopted Budget Memo

• Aligns department activities with the BART Strategic Plan

• Documents Performance Measures / KPI’s

• Engages departments with AM activities

work plans = aligned with organizational objectives

• Provides transparency on everyone’s risks

• Execs review recorded risks and prioritize

risks are invited to prepare a business case

• Business cases (white papers) are presented to the General Manager to inform decision making

QUESTIONS?

TERESA RAY

ASSET MANAGEMENT PROGRAM MANAGER

[email protected]

KRISTYL HORTON

THANK YOU!

ASSET MANAGEMENT PROGRAM MANAGER

[email protected]

mailto:[email protected]

mailto:[email protected]