ssessment of catastrophe risk and potential losses in industry

This paper describes the potential contribution of near-miss management systems to improving company profitability and reducing the frequency and severity of major industrial accidents. The near-miss concept has long been understood in different industries, as examples in this paper illustrate. However, what has been largely missing is the integration of near-miss management into the culture and day to day operations in a manner that underlines the critical connections between near-misses and behavior. Often, near-miss management has played an ex post forensic role in risk management rather than an alerting one, summarizing leading indicators and precursors of hazardous conditions. This paper describes several strands of recent research that aim to correct this and to make near-miss management an organic element of Enterprise Risk Management. In this respect, a new concept, “potential safety profit loss”, is introduced to calculate the potential monetary losses due to unexpected shutdowns and accidents.

[1]  Barbara Tufty,et al.  At War with the Weather , 1966 .

[2]  Masoud Soroush,et al.  Incidents Investigation and Dynamic Analysis of Large Alarm Databases in Chemical Plants: A Fluidized-Catalytic-Cracking Unit Case Study† , 2010 .

[3]  John O'Connor,et al.  How Cisco succeeds at global risk management , 2009 .

[4]  Masoud Soroush,et al.  Dynamic risk analysis using alarm databases to improve process safety and product quality: Part I—Data compaction , 2012 .

[5]  A. Meela,et al.  Operational risk assessment of chemical industries by exploiting accident databases , 2007 .

[6]  Nir Keren,et al.  Frequency and Consequence Modeling of Rare Events using Accident Databases , 2006 .

[7]  Warren D. Seider,et al.  Analysis of management actions, human behavior, and process reliability in chemical plants. I. impact of management actions , 2008 .

[8]  Ulku G. Oktem,et al.  Near-Miss Management: A Participative Approach to Improving System Reliability† , 2014 .

[9]  Howard Kunreuther,et al.  Near‐Miss Incident Management in the Chemical Process Industry , 2003, Risk analysis : an official publication of the Society for Risk Analysis.

[10]  Ulku G. Oktem,et al.  The Near‐Miss Management of Operational Risk , 2002 .

[11]  Howard Kunreuther,et al.  The Economics of Security Externalities Assessing, Managing and Benefiting from Global Interdependent Risks , 2007 .

[12]  Ulku G. Oktem,et al.  Near-Miss: A Tool for Integrated Safety, Health, Environmental and Security Management , 2002 .

[13]  George L. Germain,et al.  Practical loss control leadership , 1996 .

[14]  Masoud Soroush,et al.  Dynamic risk analysis using alarm databases to improve process safety and product quality: Part II—Bayesian analysis , 2012 .

[15]  Germaine H. Saad,et al.  Managing Disruption Risks in Supply Chains , 2005 .

[16]  G. Thompson,et al.  Optimal Control Theory: Applications to Management Science and Economics , 2000 .

[17]  John V. Duca,et al.  The rise and fall of subprime mortgages , 2007 .

[18]  Masoud Soroush,et al.  Improving Process Safety and Product Quality using Large Databases , 2010 .

[19]  Warren D. Seider,et al.  Analysis of management actions, human behavior, and process reliability in chemical plants. II. Near‐miss management system selection , 2008 .

[20]  D. Mitchell.  A Note on Rising Food Prices , 2008 .

[21]  A. Arcuri.  Risk Regulation , 2011 .

[22]  Stephen J. Hoch,et al.  Wharton on Making Decisions , 2001 .