Most Common Misunderstanding in Aviation Risk Management
We run across this time and time again in aviation risk management programs: safety management teams confuse hazards and risks, and consequently also confuses risks and consequences.
To be frank, misunderstanding the difference between these three things can have far reaching repercussions in your ability to practice risk management in your aviation safety management system (SMS).
These repercussions happen when safety management teams either:
- Use hazards and risks interchangeably as the same thing, either when discussing them or using them for managing risks; or
- Confuses a risk with a consequence of the risk.
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Here are several problems we often see that commonly arise when hazards, risks, and consequences are misinterpreted:
- Created risk controls will not address the most immediate risks;
- Change management projects will simply become more error prone and riskier;
- Bowtie analysis will be all but worthless; and
- Potential for risk management will be significantly stunted.
Why Aviation Risk Management Depends on Knowing the Difference
The reason it’s so important to know the difference between hazards, risks, and consequences, and classify each item accurately as you practice risk management, is the following fact:
- Hazard management activities are only as useful as your ability to understand the relevant relationships between hazards and the specific dangers they pose to your organization.
In other words, if you know the hazards, but don’t correctly know the risky situations that arise from them, then you will be misguided in what you ward against (i.e. misplaced risk controls). For risk management to be successful in safety management systems, safety management teams need to understand the clear distinctions between these three things.
Having clear distinctions will render risk management programs organized with clear boundaries for how to assess different aspects of safety events – in short, good safety management.
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What Is a Hazard in Risk Management?
A hazard is a thing (or lack of it), such a physical object, environmental variable, or a state of being that causes or leads to problems. And it’s very important to note that all hazards are a static thing and NOT a specific situation that requires immediate reaction. Another way to distinguish a hazard is that it is something has the potential to be dangerous depending on one’s interaction with it, but in and of itself it not dangerous.
Keeping this is mind will help distinguish what the difference is between hazards and risks in aviation SMS implementations.
Most examples are fairly straightforward. Here are a few to illustrate what a hazard is:
- A mountain: which can be crashed into, require emergency maneuvers, have associated weather problems, etc.;
- Incorrect procedure: which can lead to any number of dangerous situations;
- Wildlife: like a mountain, they can interfere with flight and ground operations, leading to near damage and death;
- Stresses (such as divorce): a state of being which can lead to distraction, self-destructive behaviors, etc.
- Lack of communication: which easily leads to any number of dangerous situations;
- Employee Turnover: new employees are a hazard becomes they have a potential for things like incorrect use of machinery or software, being unaware of impending problems, etc.
There are hundreds of potential hazards, but the one thing they all have in common is that they lead to problems, but in and of themselves are harmless.
What Is a Risk?
A risk is
- a dangerous situation that arises from hazards,
- the point at which safety is lost, and
- requires immediate reaction (which a risk control) or else face consequences.
They are much different from hazards in that risk are inherently – well – risky. Without direct intervention, risk are dangerous and will lead to any number of consequences.
This is an important point because often people will confuse a risk and a consequence.
Remember that a risk is the point at which “safety is lost” and NOT “damage is done.”
Where most people get confused about risks and consequences when they associated the Type of Issue, such as “bird strike”, with the risk. A risk is something you can react to and mitigate, but a consequence cannot be reacted to – it already happened. Here are some example of risk and how they differ from a consequences:
- Flying too close to a mountain – and not crashing into the mountain – is a risk. Flying too close to a mountain is a risk because it will require direct reaction on the part of a pilot to regain safety,
- Bird near aircraft – and not bird strike – is a risk because pilots will have to take immediate action (slowing down) to regain safety. Here’s a fantastic PDF that uses Bowtie to illustrate hazards, risk, and consequences of bird strikes;
- Runway incursion (resulting from lack of communication) is a risk that can have severe consciences if pilots don’t take immediate action (such as aborted landing/takeoff).
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What Is a Consequence in Risk Management?
Consequences are the repercussions of a situation, and characterized by damages, be it
- financial loss,
- loss of life,
- damage to equipment, etc.
- A consequence of Flying Close to Mountain could be a crash, injured passengers due to an evasive maneuver, or damage to the aircraft;
- A consequence of Bird Near Aircraft could be damage to hull, damage to or loss of engine(s), damage to windshield, etc.
- A consequence of runway incursion could be damage to vehicle/aircraft, loss of life, company’s reputation, and so on.
Remember, the important thing to note about these examples is that they clearly show different ways that damage is done. Consequences necessarily involve damages that can no longer be avoided. As said, this is different from risks, in which damage can be avoided.
Summary of Differences and 3 Questions to Tell the Difference
Here’s brief summary of each item:
- Hazard: a thing that is harmless by itself, but can lead to safety events depending on one’s interaction with it.
- Risk: a situation in which safety is lost and which requires immediate reaction to avoid or mitigate potential consequences.
- Consequence: the damage(s) done.
Here are three great questions that can help you clearly decide whether something is a hazard or a risk, or a risk or a consequence:
- If you don’t immediately react to it, is there a good possibility that you will face serious consequences? If yes, most likely it’s a risk; if no, most likely it’s a hazard.
- Can someone’s actions affect the outcome of this situation? If yes, most likely it’s a risk; if no, most likely it’s a consequence.
- Is this (1) a thing/state of being, a (2) situation requiring immediate reaction, or (3) some hind of harm? One is a hazard, two is a risk, and three is a consequence.
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Final Thoughts on Hazards and Risks in Aviation SMS
One of the toughest tasks in aviation safety risk management is the initial setup of the hazard register. The reason this becomes such a burden is because safety managers attempt to manage this task without the support of operational department heads.
Operational department heads are subject matter experts. From the beginning, they should be involved in developing the hazard register and regularly reviewing the:
- Identified hazards;
- Associated risks; and
- Risk Controls.
Safety mangers may be successful in solely managing the hazard register during the first four to six years of the SMS implementation. However, as the SMS matures, and as SMS inspectors become more discriminating due to your "mature SMS implementation," audit findings regularly occur because the hazard register is not properly managed.
From the beginning of the SMS implementation, safety managers should be setting the expectation that the responsibility of managing the hazard register belongs to the operational department heads. Safety managers can provide training and guidance, but the department heads should be doing the work. Otherwise, your SMS implementation will never mature and deliver the expected financial benefits.
Department heads may be lukewarm to your demands that they participate in managing the hazard register. This may be due to:
- Their imperfect understanding of their role and responsibilities to the SMS;
- Lack of adequate tools to document and manage identified hazards, risks and risk controls;
- Inadequate training on provided hazard register tools.
If your company does not have a good hazard register, the following list will jump start your list of hazards. If you are an SMS Pro user, don't worry about this list, as it is integrated into the SMS database's "Proactive Hazard Analysis Tool (PHAT)."
Managing a hazard register in a spreadsheet is not a best practice. A best practice is to have your list of hazards integrated into your risk management system that you use to classify reported safety issues and audit findings.
While you could manage hazards in a spreadsheet, this will be manageable if your company has fewer than 100 employees and is also a simple operation. Otherwise, we recommend that an SMS database be either built or acquired. There are a few good SMS databases on the market, but one thing you should look for is the hazard register integrated into:
- Risk management processes; and
- Compiled charts and reports.
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Does your SMS need a low-cost, commercially available SMS database? Learn how SMS Pro can help your company achieve its SMS goals and objectives. Below are some short demo videos you may find useful.
Published October 2016. Last updated April 2019.