Why You Need To Know Difference Between Reactive, Predictive, and Proactive Risk Management
Aviation safety managers and employees who understand the real difference between reactive, predictive, and proactive risk management activities gain considerable benefit for generating good safety performance.
The fact is that these three types of risk management strategies are often misunderstood and/or confused.
Can you describe the difference?
Each type of strategy has particular activities and behaviors that are useful in different situations. We can understand the basic purpose of each type of risk management as follows:
- Reactive: mitigate severity of safety events and threats;
- Proactive: identify safety concerns before safety events happen; and
- Predictive: anticipate future exposure based on past performance data.
Developing all three forms of risk management involves understanding your aviation SMS program and employees. Let’s look at each what each type of risk management is, and situations when each type is useful.
What is Reactive Risk Management
I can’t help but feel like reactive risk management has kind of a bad reputation in aviation SMS programs. It’s often perceived as the “lowest” or most basic form of risk management. This idea is propagated mainly because reactive risk management is generally associated with aviation safety programs that are:
- Early in implementation;
- Not very developed safety program; and
- Lack of safety culture.
A better term for the above would be “underdeveloped” risk management. Reactive risk management is extremely important for new and mature safety programs. Programs without strong reactive risk management strategies are exposed to considerable risk. This is because reactive risk management is an essential element of:
- Mitigating safety events;
- Minimizing damage from critical safety situations;
- Acting quickly and efficiently in response to undesirable incidents; and
- High quality decision making in reaction to safety data (threats, risk, etc.).
Long story short, reactive risk management is the ability of all safety personnel to make good decisions without premeditation. Being able to do this takes years of experience and aviation risk management training.
When To Use Reactive Risk Management Strategies
Reactive risk management is best used as a strategy in the following situations:
- In new SMS programs who do not have the requisite safety data to practice proactive or predictive risk management;
- In response to safety events; and
- In dealing with threats that suddenly arise the operating environment.
High quality reactive risk management is critical at all levels of SMS implementation. In particular, new SMS programs will deal with more safety events as they learn what they are exposed to.
Setting quality reactive risk management behavior early in implementation will prove to be extraordinarily beneficial as the program is implemented. Cultivating quality risk management requires:
- Quality risk management training for all employees;
- Strong bureaucracy regarding safety behavior, such as procedures, checklists, and a list of desired employee behavioral actions; and
- Good hazard and risk fluency for identifying and assessing safety items.
What is Proactive Risk Management
Proactive risk management is often upheld as the highest form of risk management. This is because being able to demonstrate proactive risk management activities generally doesn’t happen until an SMS program is fairly mature.
The primary goals of proactive risk management are:
- Identify precursors that lead to threats, and risk;
- Identify threats before they lead to risks; and
- Understand safety “inputs” – i.e., underlying causes that lead to safety performance.
Being able to practice proactive risk management generally requires:
- A great deal of safety data;
- The ability to monitor complex safety metrics; and
- A mature safety culture.
That being said, there’s no reason that new aviation SMS programs can’t partially adopt some proactive risk management strategies, such as monitoring a handful of leading indicators.
It’s important to remember that proactive risk management is not simply a concept or “better” version of reactive risk management. Proactive risk management involves specific activities that are entirely different that reactive risk management activities. Both reactive and proactive risk management complement each other, and each strategy is useful in different situations.
When To Use Proactive Risk Management Strategies
Proactive risk management strategies are best used in the following situations:
- Identifying potential issues before a risk occurs, such as when threats are emerging or when hazards increase in severity;
- When trying to understand the inputs of the program, which are underlying behaviors, attitudes, and actions that directly correlate to safety performance; and
- Uncovering precursors to risk, such as the relationship between certain a hazard, a threat, and a risk.
Like reactive risk management, proactively managing risk is the responsibility of front line employees as well as safety management. Each sector of an organization has its own proactive behaviors that generate a solid, proactive culture in an aviation SMS program.
What is Predictive Risk Management
I see predictive risk management confused with proactive risk management all the time. While there can be overlap between proactive and predicative management strategies, they are for the most part distinct.
Predictive risk management attempts to:
- Identify possible risks in a situation based on given circumstances;
- Identify new threats in hypothetical scenarios; and
- Anticipate needed risk controls.
Predictive risk management is largely possible due to the use of lagging indicators, or past historical performance, which are used to predict possible future performances. This is the exact opposite of proactive risk management, which uses aviation leading indicators to directly assess underlying causes and precursors to current performance.
When To Use Predictive Risk Management Strategies
Predictive risk management becomes extremely useful in the following activities that are common to aviation safety programs:
- Management of change;
- Risk analysis in hypothetical scenarios; and
- Forecasting performance data (such as to stakeholders).
It’s important to understand that predictive risk management is useful for creating expected “ranges” of safety performance, and a framework for future risk exposure. Specific predictive risk management information should not be trusted to the same degree that, say, proactive risk management information is.
You will find the following free resources helpful for developing your proactive and reactive risk management activities: