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Are companies assessing engineering risk correctly?

Events at the Fukushima nuclear power plant are an extreme example of a low probability, high consequence event.

But while there will be plenty of discussion, research and lessons learned into what happened at the plant, closer to home are executives at civils firms giving enough attention to this type of scenario?

A recent study by the Construction Industry Research & Information Association (Ciria) suggests they are not.

Ciria’s report, Preventing Catastrophic Events in Construction, produced with Loughborough University and the Health & Safety Executive (HSE) at low probability, high consequence events to help give the HSE a better understanding of hazard and risk profiles in the construction industry.

“The reasons for catastrophic events are complex…but you can’t approach them in the same manner [as other events]”

Alistair Gibb, Loughborough University

Speaking at this week’s formal launch of the report, supported by NCE, Loughborough University construction engineering management professor Alistair Gibb, who worked on the report, said there is concern that boards of directors are focusing on smaller events and missing the big ones.

“The reasons for catastrophic events are complex…but you can’t approach them in the same manner [as other events],” said Gibb.

In bigger firms the boardroom can be quite far away from the engineers taking day-to-day decisions.

HSE head of operations and construction engineering specialist Mike Cross, who oversaw the report, believes that boards are concerned about hazards, but are distracted by issues such as resource allocation and running a business.

Speaking to NCE last year, Cross said that they should consider the possibility of a major event occurring as a higher priority

Also speaking at the launch event this week Cross said: “We investigate 20 to 30 [major events] per year - it’s not that low.”

There is agreement within the industry that these types of events can threaten a whole business.

The Hatfield train crash in October 2000 led to Railtrack’s demise and replacement by Network Rail.

More recently, Deepwater Horizon oil spill in the Gulf of Mexico has had a major effect on oil giant BP.

“[There can be a] collective loss of concentration at board level,”

Mark Whitby, Davies Maguire + Whitby

Past ICE President Mark Whitby, now a director of consultant Davies Maguire + Whitby, believes it can be sometimes difficult for boards of directors to appreciate the risks being taking by engineers at operational level.

“[There can be a] collective loss of concentration at board level,” he told NCE.

There is a gulf between those at board level and there can be management failure that causes accidents, he said.

Boards often use various performance criteria, such man hours lost, to help assess a company’s safety performance. But such measures are now stating to look outdated.

“We’re stepping away from areas such as number of man hours lost to key performance indicators,” said Network Rail programme director Ian Fry, also speaking at the event.

Fry and others are concerned that some types of measurements, such as man hours lost, don’t actually translate into the safety performance of a company and can often produce unanticipated consequences.

“Sometimes things get pushed underground [using these methods],” he said.

Gibb believes developing an understanding of safety and risk management should begin with students at university.

But he says many academics have not been on site and therefore lack the skills to teach risk and safety management (see News).

For some engineers, however, it’s all about learning from experienced engineers. “We need engineers who are competent,” said consultant Structural Studies & Design director Jonathan Wood.

Wood believes that young engineers must learn from more experienced colleagues so that as they gain competence, the risk of a major accident will reduce.

However, with many engineers due to retire in the next 10 years, and the loss of clients’ in-house engineering team to privatisation, there are plenty of challenges for the industry.

Civil engineers must get to grips with the risk of low probability, high consequence events because of the potential risks to human life and the knock on effects on their companies.

As Gibb says, companies do need to properly answer the “what’s the worst that could happen? ” question when undertaking a project.

Readers' comments (4)

  • John Mather

    Quite right, a good risk management plan will provide for critical risks to be escalated. That said, low probability, high impact risks pose more of a threat than high probability, low impact risks. It is important to differentiate between the two.

    John Mather

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  • I agree with John Mather. I am sure that there is room for improvement on holistic mangement of operational risk. Although a casualty-free world is unachievable, many of the major incidents such as the one at Fukushima nuclear power plant could be avoided or mitigated. Increasingly the world of "design, check, audit, monitor, correct" is only fit for purpose in conventional scenarios. Where risks are higher (or perceived to be higher) there is a need for greater rigour and collaboration. Just as all "accidents" are multi-faceted it takes a muti-faceted approach to understand what may go wrong, how often and with what consequences. Those with an interest in a highways context may wish to read IAN 139 (on Highways Agency website) to see how they now manage risks for their complex projects.

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  • Declan Lynch

    Peter and John - thanks for the feedback and both are interesting points.
    How do you think firms can assess risk of catastrophic events?
    Peter, in reference to Highways Agency IAN 139 - are you aware of the similar safety management documents for railway and other sectors?

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  • John Mather

    Declan,

    By keeping an open mind, by involving informed stakeholders and by making best estimates of probability and consequence. By using range estimates of outcome (minimum plausible, most likely and maximum plausible).

    John Mather

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